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Focusing on Irrelevant Issues Can Complicate Contract Negotiations

Contract negotiations don't have to be complicated. The simpler a contract is, the easier it is to understand and follow. Focusing on irrelevant issues is one way contract negotiations get complicated. Focus on the issues that matter to keep things simple. 

Concentrate on Terms That Matter 

There are a set of terms that matter most during contract negotiations, regardless of your industry. These include:

  • Confidential matters. Terms that ensure the other party will safeguard any confidential data revealed through the necessity of the business relationship.

  • Payment. Terms detailing the how and when of payments.

  • Dispute resolution. Terms detailing how you will handle disputes should they arise.

  • Delivery. Terms regarding how often you will deliver goods or services, how much will be delivered, and the price for those goods.

There may be other essential terms for those working in specific industries. However, the above are some of the most critical terms in most contract negotiations and should be focused on before anything else. 

Rank Your Top Objectives 

Your objectives should be determined before you sit down to negotiate the contract. Understanding what you hope to accomplish from your business agreement gives negotiations purpose. Going in blindly makes it challenging to weigh counter offers or determine if you're getting a good deal.

Create a list of objectives and rank them in order of importance. Calculate the minimum amounts for these objectives if the deal is to remain worthwhile. For example, you may have a minimum amount of items you need ordered per delivery period. Take all cost factors into consideration to reach a starting point. For a deal to be profitable, you'll also need to add between 2% and 10% to this total for your profits (according to your business model). Do this calculation for all your primary objectives.

Then, consider alternatives to your objectives. These are the second-best options to achieving your goals. For example, if a company can't meet your order minimum but can pay a slightly higher price per product, the deal may still be worthwhile. If you can't get your first option, these alternatives will be your Plan B. What makes this advanced planning even better is that it makes weighing counter offers from the other party significantly easier. 

Present an Attractive Contract 

You can help the negotiation process go smoothly by presenting an attractive contract at the beginning. Your contract should be detailed, organized, and attractive. If you compress a PDF online can help to create the organized and easily accessible file. 

Additionally, the physicality around the way you present your contract matters. Consider reading articles about developing a winning presentation. You may also want to read up on the importance of body language in business negotiations.

Keep Things Simple by Avoiding Irrelevant Issues

Focusing on irrelevant issues can make contract negotiations unnecessarily complicated. Avoid issues that aren't relevant, and focus your energy on the most important matters instead.

Consider joining your local chamber of commerce for more valuable business resources as well as discounts and networking opportunities in your area.


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