New Venture Lab: Equipping Christian Entrepreneurs

Question

We are looking for a good solid sales and installation agreement for installing renewable energy systems in homes and businesses.  We have one we use now, but we are not happy with it.  I believe that a good contract is a good sales tool and an excellent customer service device, but I do not know how to get from where I am to a good contract and I do not have a lot of capital to invest to get one created.  Any help that you could give would be greatly appreciated.

Answer

Your sales and installation agreement sounds like it will be very unique and is therefore necessarily a customized agreement.  In order to minimize the amount of legal costs associated with getting an agreement put together that will work for your unique business circumstances, I would suggest the following:

 

1. Take the time to outline the agreement on your own such as moving the sections around to how you want them, adding section headers for new sections you feel you need, etc.  This way you are not paying an attorney hundreds of dollars an hour for simple word processing work.  I would strongly suggest that you create an exhibit that moves all key negotiating points such as customer name, your business name, agreement date, price, specific deliverables, to the exhibit so that your core agreement never gets negotiated or changed. 
2. Winnow best practices from other similar companies by taking a copy of their agreements and using them to finalize your thinking and your agreement outline.  You are not trying to play lawyer, but only getting a sense for what others are using and educating yourself on the different types of agreement clauses that may apply to your unique circumstances.
3. Next, I recommend that you put as much as your business knowledge as possible into the legal framework.  This way, all the attorney has to do is fill in the legal text.  To do this, embed your notes into the agreement outline on what the business need is given a particular topic and what you are looking for the agreement to cover.  For example, if you want an indemnification section that holds you harmless by the customer (a good idea), then simply create a section header in the outline titled “Indemnification” and write in your notes regarding why you want this protection, how you think it should work and your thoughts on any cross-indemnity if at all.
4. Next, hire an experienced business contract specialist attorney to review and finalize your document.  This should go fairly quickly since little time will need to be spent getting to know your business requirements.  Be sure to get a clear estimate on the amount of time and cost so you will avoid a rude surprise later.
5. Finally, take the final text and create a “form” out of it by taking all the standard terms and conditions and putting a border around them, number the form so you can keep track of what version it is and do everything you can to make this a standard agreement that does not get changed.  On your exhibit that contains all of the key negotiated terms, make the form as much of a “check the box” type of form that you can easily fill in or select the appropriate terms and sign.  What you want to avoid is the back and forth of redlined documents on each deal by attorneys on both sides that will eat up all of your margin on the deal.  You want to be able to carry a stack of forms with you, check a few boxes and execute the agreement.

In the end, by spending your time wisely and embedding your knowledge and needs into the front-end of the process, you will hopefully save money as you can avoid paying the attorney to that discovery work for you.