We all know the basics of what a contract is it’s what companies use when agreeing sales, purchases, employment and so on. But, what happens when we want to look after our contracts, make sure that they are properly looked after and we know what they mean? Well, first of all we need to know everything about the contracts we use, and then we need to find some contract management software that means you can create them, enforce them, check them and renew them. One of the main contracts is sales.
Usually referred to in the business world as a contract of sale, this is a legal contract that defines an exchange in goods, property or services between a vendor and purchaser. It shows the pay and promise of money that was agreed during negotiations. To say it was common would be an understatement, and they are signed every minute across the globe.
It was one of the first kinds of contracts, and is an ancient practice that goes back to when merchants began exchanging goods thousands of years ago. Obviously, times have changed, the contract has grown to be more complex and it is used frequently. Today it tends to be governed by statutory law, under jurisdictions of common law, and makes transactions between consumers and sellers very simple to understand and straightforward.
Across the United States and Canada, contracts for the sale of goods is governed under the uniform commercial code, article 2, which was published in 1952 and is around in attempt to harmonize sales law across the United States of America.
With a view on reducing your exposure to liability and other things, most sales contracts set up like this:
• Warranties – this refers to your business wanting to warrant certain products, a remedy for the buyer, showing how long your warranty lasts and check what is excluded from warranty.
• Consequential damages – remember to disclaim your liability.
• Delivery – check whether your contract contains a “time is of the essence” and a “force majeure” clause.
• Patent indemnification – Check the copyright, intellectual property and broad patent so that the contract protects your indemnification.
• Termination – can you terminate it at your convenience? Can it be terminated if terms aren’t met? Can you terminate on default?
• Acceptance – can you defer time of acceptance or reject goods that arrive after delivery?
• Most favoured customers
• Indemnity
• Entire agreement
• Modifications
• Confidentiality
• Product licenses
• Compliance
• Law
• F.O.B. point
• Taxes
As we can see, sales contracts can be complex things and to have them looked after by your contract management software can be a great weight off your mind.