The following publication is currently under review. Elements of the information in the publication may be out-of-date. Please use the information with caution.
This guide (published in 2001) aims to assist small business managers in using contracts confidently and appropriately as a commercial tool. It has been specifically designed to familiarise small business managers with the following issues:
Note: This information is available in Adobe Acrobat format at the end of this web page.
How the guide can help you
Dealing with contracts is very much a part of small business management. Once in place, contractual requirements largely dictate the way in which small businesses operate. In short, they underpin the viability and security of any business, large or small.
Confidence in working with contracts is therefore very important.
Confidence comes from understanding. This guide is specifically designed to familiarise small business managers with contracts – what they are, what they contain, how to avoid the pitfalls – and to help them get the most from these very valuable and fundamentally important business tools.
In particular, the guide provides a plain English approach to understanding:
- the essential ingredients of a contract, supported by useful and practical examples relevant to small businesses
- the more frequently encountered and important legal jargon used in contracts
- the different types of contracts
- the basic content and structure of contracts
- what standard form contracts are and some useful pointers on constructing your own
- some of the basic issues relating to specific types of small business relationships.
This guide also provides a summary checklist of all the issues raised and where to obtain more detailed information and assistance.
The guide is not intended to tell you everything there is to know about contract law. It will not replace the need for professional legal advice where a thorough understanding of the law will be required.
The guide is about giving small business managers the ability to be able to use contracts confidently: to be able to identify the major issues and avoid the major pitfalls.
The 'big picture' of small business relationships
The small business sector is no different from any other sector in its need to manage a whole variety of business relationships. Most, if not all, of these relationships will involve contractual commitments and obligations.
You may be:
- a consumer of goods and services:
- a borrower of finance,
- a purchaser,
- in rental agreements, and
- franchise agreements
- a provider of goods and services:
- retailer,
- professional consultant, or
- trades person
- in some form of partnering agreement with other businesses:
- joint ventures,
- strategic alliances,
- partnerships,
- subcontractors.
Contracts need to be managed. It is often a good idea to keep in touch with the other party to ensure that contractual obligations are being met as they should be. Sometimes a little give and take is necessary to cope with unforeseen circumstances. Managing the relationship may be as important as managing the contract.
Managing small business contractual relationships
Agreements to supply your business
-
leasing premises
-
receiving and quoting
-
borrowing money
Agreements to supply others
- franchising
- renting equipment
- tendering and quoting
- credit arrangements
Agreements that regulate business relationships
- strategic alliances
- franchise agreements
- joint ventures
- agency agreements
- partnerships
- dealerships/distributor agreements
For further information on any of the above, please email the Industry and Small Business Policy Division.