Small business owners often take everything into their own hands. They might have ideas, but they often do not have skills when it comes to risk management. As a result, they make the wrong choices, and this costs their businesses dear. This often holds true for service contracts and business finance. Though most of these contracts are written and legally binding, some companies can be flexible with the terms and conditions listed, especially when it comes to payments. As a small business owner, you should be alert and aware of these terms so that you face no problems or losses, especially if you have a tight budget.
Kavan Choksi is a widely respected and skilled entrepreneur who is fond of travel and photography. He is an expert with business skills and recommends small business owners to educate themselves about risk management strategies to ensure their business is resilient to general threats. However, besides this awareness, there are other things that a business owner should take into account when it comes to risks- one of them is service contracts.
In his opinion, one needs to be very careful when it comes to small business service contracts. Some companies often do accept small changes, while some are afraid to make even the slightest change to their contract. They are scared to get lawyers involved, and the whole process will become a costly affair. Moreover, such complications will also slow the process down, and this generates a lot of fear in both the parties to the contract.
Make modifications in the beginning to avoid risks
When you get a service contract and find a line or phrase that you do not agree to, all you need to do is request the other company to accept the modification at the outset. In this way, you can avoid risks and not face losses, especially when it comes to cash flow issues and business finance.
What should you do?
When it comes to service contracts and changes that you wish to do in your favor, you should read the terms and conditions of the contract thoroughly. If you get a clause that says you will be billed for late delivery payments if it is not received in 30 days. The typical schedule for processing all the accounts payable might not match the other company’s billing cycle. This makes it quite possible that the payment might come in after 30days of the billing cycle. It is here that you can take their contract and strike out that sentence asking them to change 30 days to 45 days. You can even email or fax this modified document to them, making a phone call explaining why you should need this change.
According to Kavan Choksi, as a small business owner, it is important for you to get contracts for your goods and services. In this way, you can accept the service contract and get the change done in a professional matter. However, when it comes to making changes in service contracts, you just need to follow this simple tip listed above