3 Simple Ways Contracts Can Make You More Money

Contracts can be confusing, long and not necessarily what you want to think about on a Friday night. Yet they are essential to protecting your business. They set out the price, scope, and all of the relevant terms and conditions for the sale. But they also do much more than that. When written correctly, your legal contracts can actually make your business more money. Here are three ways they can do just that:

1. Stand out from your competitors. A lot of potential clients like to shop around. They may be looking for the best deal, the best fit or the brand that speaks to them. In many cases, they will get multiple quotes before selecting a business to hire. When I hire family photographers, I contact a few and ask for a quote as well as a copy of their standard client contract. Recently one photographer told me she didn’t have a contract but would be willing to work with me in whatever way suited my family the best. That sounds nice but right away she lost me as a customer. Rightly or wrongly, I believed that because she did not have a standard contract she lacked the experience and professionalism that I wanted. A photographer who has been in the business for awhile should have a standard contract. If they don’t, they come across not only as inexperienced but unprofessional as well. The other photographers sent me beautiful well written standard contracts. As a result, I felt comfortable with them because they seemed to know what they were doing.

Behind the scenes, they may have been a hot mess, but just having a professional contract set them apart from the photographer who did not have one. 

The lesson here is that investing the time and money in a professional contract in the first place will actually win you more clients in the long run. Need help drafting a contract? You can work with me one on one or purchase a DIY template for your business.  

2. Increase prices. Do you account for the IP that you provide in your contracts when calculating the price of your product or service? Often small businesses do not. Keeping with the photographer example, if the photographer transfers copyright of the images to the client, the photographer should ensure that that transfer is quantified. An image can be very lucrative. When the copyright is transferred, the client can do with it what they want. They could post it on their social media accounts, websites, create products using the image, sell the image, etc. Simply put, the client can make money off of the photographer’s image. Make sure to account for this when calculating the price in your contracts. 

3. Focus on your ideal client. If a potential client is giving you a lot of headache over your standard contract – asking for one sided changes, completely revising your agreement and/or being unreasonable, chances are this is not the type of client that you want to work with in the first place. There is nothing wrong with negotiating the terms of a contract, but if the back and forth is just a waste of time, it may be time to move on and find the clients that are willing to respect your terms and are willing to pay your price. You only have so much free time, why not spend it working with the clients that are respectful of you and your services? Don’t waste your time on clients who are not willing to work with you on your terms. There are plenty of others who will.

About Amy Grubb

Amy Grubb is a business lawyer with over a decade of experience helping her clients save money with their legal contracts. To learn more about her services, visit her website or email her at amy@grubblaw.ca.

Note: This article provides an overview only for informational purposes and does not constitute legal advice.