There are few things worse in business than waiting, waiting, waiting on a contract that should be a formality, but that drags on for weeks, and sometimes months or even years. Good relationships can sour, conditions can change, your key contact can leave the other company, or momentum can simply be lost. For want of a signature on a dadburn contract, businesses have gone under.
I’ve had more situations than I care to remember where a potential partner told me on the phone “I’ll send you a contract, it’s all just standard stuff” and then realize with chagrin that there were important terms in the contract that we had never discussed. Nothing like feeling a bit of bait and switch, and staring at it in full-blown legalese. Best way I know to tank a deal. Sometimes people feel awkward bringing up the terms before sending out a contract, sometimes they may actually think they can sneak them through.
One really effective way to speed up the contractual time table is to first agree on a simple bullet point list of basic terms. Include price / fees, term, territory, conditions, payment terms – anything that could cause disagreement. Get everything out in the open on the concept level. That way the contract really is about formalities, what happens if something goes wrong, etc.
Have the basic terms agreed by the business people in a bullet point term sheet. You’ll not only save on legal costs, you’ll likely get your deal signed sooner, and you’ll keep your important relationships in good shape.