Nearly every seller will need some type of contract during the growth and operation of their ecommerce or Amazon business. In fact, some sellers enter into contracts on a regular basis, especially private label sellers who use contracts when sourcing inventory or transportation services. Every contract that you or your business enters into should be carefully drafted and reviewed to ensure that your business’s legal rights are protected, and that the contract does not create any unnecessary liability or extra cost for compliance. For example, some parties may want you to sign a “Personal Guarantee.” While a personal guarantee doesn’t sound scary, it can create personal liability for the person signing it, and therefore should be carefully reviewed and negotiated to limit its scope and applicability.
Many business owners do not know the principles of contract law, and may turn to Google or a “guru” for sample contracts. However, this approach is dangerous to your business, as these contracts rarely cover all the bases that are necessary to protect your business rights. Furthermore, these contracts may be based on a state law other than where you live, and therefore may contain clauses that are unenforceable in your state.
For these reasons, it is very important that you engage an eComAttorney that understands both Amazon and eCommerce when drafting contracts for your business. If you are presented with a contract, our experienced attorneys can evaluate the terms, recommend changes, and negotiate for terms that protect and benefit you. Additionally, if you already have a contract in place, and the other party is not upholding their obligations, our attorneys can review the contract and advise you of your rights to enforce the contract.
What about online services, and DIY websites?
If you’re a small business owner, it’s likely that you’re a savvy entrepreneur who is looking to save money wherever you can. As a result, you may be tempted to use one of the several online do-it-yourself legal services to draft your essential business contracts. These services tend to be much cheaper than retaining an attorney and allow you to “plug in” your relevant information and out pops a contract. What could go wrong?
Unfortunately, the answer to the question posed above is “a lot.” Contracts that are not carefully tailored to the specific circumstances at hand and to the jurisdiction in which they will be executed can result in significant unforeseen consequences and may even be completely unenforceable. Imagine that you find yourself in a dispute with a vendor that you believe can be resolved through a straightforward legal action to enforce your contract only to find out that it does not comply with the laws of your jurisdiction and is completely worthless. At that point, it’s fairly certain that you will wish that you had spent the extra money to have an attorney draft you a contract specific to your needs.
A lawyer can do many things that an online service cannot. These include:
- An attorney can take the time to thoroughly understand the ins and outs of your business, allowing him or her to recognize liabilities that you may not have even known existed.
- A lawyer can evaluate your employment relationships and draft contracts that protect your intellectual property and also help you recognize non-contractual liabilities that may arise from your employment practices.
- An attorney will be able to draft contracts specific to your customers and vendors, ensuring that all issues unique to your business model are addressed.