I’ll admit it. The seriousness of the Coronavirus did not hit me until March 11, 2020.
That was the day I went to an all-day conference for women attorneys. For the first time, I was directed not to exchange business cards, and to not fix my own coffee or pick up breakfast or lunch at the buffet table, but instead, wait in line while the caterer took care of it for me. And I was never more excited to see conference swag featuring hand sanitizer. That was the last in-person meeting I attended.
While it’s still hard to tell how the Coronavirus will impact us in the long term, it’s become a subject that’s impossible to ignore. While some are advocating we prepare to be quarantined, potentially for months, others are saying self-distance as best you can and as the seasons change, the situation should improve (similar to the flu).
No matter what side you are on, the coronavirus is a pandemic, and there is the possibility that your business could be affected due to public perception and fear.
But there is an opportunity here. The last few weeks have forced businesses big and small to really look at how they do business, their systems (or lack thereof), and crisis management planning.
Now would be a good time to take a look at your contracts. In the past, you may have been tempted to take the do-it-yourself (DIY) route and only focus on the bottom line (i.e. your fee) and the other party signing on the dotted line to engage your services.
While nowhere near exhaustive, here are a few quick tips:
Scope of services
Instead of only including the title of the package your client has purchased, consider a summary or bullet points of the work involved. It’s also a good idea to include an exhibit that provides more granular details of those services and then reference the exhibit in the contract.
I recently supported a small business owner who has been in business for seven years in the event-planning space. And while the majority of my client’s engagements go according to plan, we enhanced her contracts to account for the scope of the work AND maybe more importantly, what the service does not include and which would require additional fees.
The new and improved contract also stipulates how “additional services” will be managed.
Payment
It’s not enough to simply include your fee, but have you included a schedule of payments that makes sense for your business? What do I mean?
Every business is different, but do you currently require a sufficient deposit that takes into account what it takes for you to onboard a client?
Does your contract clearly state that deposits are non-refundable?
What about expenses directly related to that client (I’m talking to anyone providing live event services especially)?
Who pays?
If the scope of services outlined requires the work to be done in stages, how are you paid for the work you completed if the project is terminated?
Don’t forget that it’s not only the fee that is negotiable but the how and when you are paid are too. As the current times would have it, I was able to advise another client while at the March 11 conference on what her options were concerning a contract drafted for an event that was to be held in May but was now canceled. Thankfully, she was paid the non-refundable deposit which was half of the total contract and fairly represented the work that was completed up until the time of cancellation.
Force Majeure
It’s a fancy term for unavoidable catastrophes (actually it’s French for “superior force”). In a contract, it’s a clause that is too often ignored (usually placed in the last half of a contract) but is critical because it speaks to those times when natural or unavoidable catastrophes prevent the parties to the contract from fulfilling their obligation.
I can’t tell you how many contracts I’ve reviewed (most likely DIY) with no such clause or are poorly written.
I’m a big advocate for contracts that are written in plain English and as concisely as possible. But, you should NEVER exclude what you deem to be non-essential. Those clauses mean something. Contracts, and the right clauses, are designed to protect your company and manage the rights and responsibilities of everyone you do business with: clients, vendors, employees, and contractors.
Listen, I pray this is all over soon enough. Since we all have a little more time at home, let’s take this as an opportunity to improve, both personally and professionally. We are here to support you - to make educated, informed, empowered decisions for yourself and your business.