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  • Rookie Mistakes to Avoid When Negotiating Contracts

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    July 28, 2022

    According to statistics, small businesses employ about 47% of workers in the U.S. — and each of these employees must sign an employment contract as part of their job. Still, negotiating a contract can be an incredibly stressful endeavor — especially if you’re new to business. You can transform that stress into strength, though, by preparing for the negotiation process. If you’re a beginning business person looking to negotiate contracts with competence, be sure to avoid the following rookie mistakes.


    Entering Negotiations With Ignorance

    You’ve already avoided the most obvious mistake — entering negotiations without doing any prior research. Indeed, entering negotiations with ignorance will set you up for exploitation. Contracts are imperative to facilitating business arrangements and preventing disagreements. In order to achieve this objective, you must enter negotiations with a baseline of knowledge about the process and the other party.


    If you’re not sure what kind of research to do, don’t fret — you can start by looking up the other party and assessing whether it’s a good idea to do business with them. You can evaluate this based on customer reviews and court records — if there are any. With this information, you won’t be negotiating with complete strangers, and you can also ensure that you’re dealing with the right party.


    It's also important to enter negotiations with a clear vision of your own objectives. Approaching a contract with ambiguous intent is a recipe for disaster, and you need to anticipate the potential for disputes. Develop a plan for resolving contract disputes so that you have a proposal ready to present.


    Letting the Other Party Dominate

    Another major mistake made by beginning business owners is letting the other party dominate the discussion when negotiating. This may even seem appealing if the other party is more experienced than you. You should always expect equal airtime in contract negotiations, though. Anything less can result in the contract being rushed.


    To assert yourself, you should start by outlining your expectations for your business and the other party. The contract should ultimately include an explication of the obligations that both parties agree to. It should also include a provision for termination or revision of the contract if either becomes necessary. If you do need to revise the contract, you can use an online tool to extract PDF pages to easily modify and present a document. Simply select the pages you want to keep and add them to a new PDF.


    Automated accounting software is another useful tool for contract negotiations. If your contract includes financial data from your company, you need to be absolutely certain that it’s accurate. When you use real-time cash flow data from the best accounting software, you don’t need to worry about sourcing information from multiple platforms — and potentially making a mistake in the process. A single program can provide all the information you need — including a financial overview — to understand your company’s money. You’d be wise to freshen up on your accounting terms as well so that you can follow along seamlessly with any advice you’re given by an accountant, colleague or otherwise.


    Get the Results You Want From a Contract

    Contract negotiations might seem intimidating to new business owners, but with the right tools, you can avoid the mistakes that others often make. Resources such as an all-in-one accounting program can give you the data you need to negotiate — and if you do need to revise the contract at a later date, it’s easy to do so with a PDF extraction tool. Ensure that you and the other party both get the results you seek from negotiations.

    Want more great tips? Be sure to join the Chamber of Hickory Nut Gorge to connect with local business and financial experts. Then, head over to Zenbusiness.com to learn the ins and outs of all things business, from setting up an S Corp in North Carolina to funding your new business.