In the olden days, a handshake or a person's word was enough to seal the deal. Now however, that handshake should be in conjunction with a written and signed contract or agreement. What should go into that contract?

In Episode 18 of the Circle Legal Business Fit-It Show, Kelley Keller and Susan Gunelius discuss the nine facets of a contract or agreement and why customizing those areas is so important.

TRANSCRIPT AND AUDIO OF EPISODE #18
Announcer: It’s time to LIFT your business and your life on the Circle Legal Business Fix-It Show with your hosts, Kelley Keller and Susan Gunelius. Learn how to build a business you love on a solid foundation that delivers the future you want for you and your family. Here are your hosts, Kelley and Susan.

Kelley Keller: Innovative companies, business owners, and families, welcome to the Circle Legal Business Fix-It Show where you will learn how to LIFT your business and your life with help from recognized legal and business experts you can trust. I’m your host, Kelley Keller, coming to you from the iHeartMedia studios in Harrisburg and with me is my co-host, Susan Gunelius, joining us remotely via video conference. Hi Susan. How are you today?

Susan Gunelius: I’m great, Kelley. I am ready for a good show today. How about you?

Kelley: Absolutely. Let’s do it.

Susan: We’ve been talking about those nine steps to build your business. To build that solid LIFT Foundation. Your Legal, Insurance, Finance, and Tax building blocks. Without those building blocks, you either are going to fail or you’re going to get yourself into big expensive trouble later.

And so far we’ve gone through number one, plan for the business you want. Number two, become a business. Three, get the insurance you need. Four, become an employer. Five, review your intellectual property. And now we’re on six which is protect yourself with contracts.

This is an area I think has gotten even more important over the last few years because people have access online to all of these template agreements and contracts you can copy and paste. Ultimately, I think business owners are putting themselves at huge risk. No one wants to pay for an attorney, but there’s a reason why attorneys exist. So today’s show is going to be all about protecting yourself with contracts.

So Kelley, let’s start at the very beginning. You’re the attorney, why do we need contracts as business owners?

Kelley: Well, contracts simply are a written documentation of the agreement between the parties. So Susan, if you and I make an agreement, I ask you to perform a service for me. I agree to pay you a certain amount of money for it, then the contract itself actually documents the parameters of that agreement. So exactly what is the scope of services? In what time frame are you going to deliver them? When am I supposed to pay you? How much and in what manner? And if we end up having a disagreement, how are we going to resolve those disputes? It takes away the he said she said. When you have a written contract, then ultimately the writing is the final arbiter of what that relationship means. Not what my memory of it is or what your memory of it is.

So it kind of goes back to the adage good fences make good neighbors and it’s a way to make sure that everybody is moving forward on the same page and that there are no misunderstandings in business relationships.

Susan: So before we go any further and talk about what’s in a contract—what matters in your contract that you get for your business—let’s step back a little bit. What is a contract or an agreement? We hear both words. Are they the same thing? Are things like the language on your invoices or your estimates, are those contracts too? What are the contracts that business owners should have at the very least?

Let’s take that into three parts. First, what are contracts and agreements? You said there’s this handshake or in writing so you can actually know who said what a