In our last blog post, we explored what constitutes a commercial contract. Now, we’re looking at common types of business contracts and what they cover.
Any business arrangement between two parties – buyer and seller, employer and employee, or partners in a venture, for example – can be the subject of a contract. Here are some common types of commercial contracts:
Sales contracts outline the terms under which a seller agrees to provide goods, such as office supplies, to a buyer in exchange for payment. They typically cover pricing, delivery timelines, warranties, and conditions for returns or refunds.
Service Agreements
Service agreements define the scope of work, payment terms, and responsibilities between a service provider, such as a law firm or management consulting firm, and a client.
Distribution Agreements
Distribution agreements establish the terms between a manufacturer or supplier and a distributor who sells or markets end products. They often cover territory rights, pricing structures, and performance expectations.
Licensing Agreements
Licensing agreements grant permission from the owner of a particular intellectual property (IP) to another party to use that IP in exchange for royalties or fees. They are common in technology, entertainment, and brand merchandising.
Employment Contracts
Employment contracts outline the terms of the working relationship between an employer and an employee, including job responsibilities, compensation, benefits, confidentiality clauses, and termination conditions.
Partnership Agreements
Partnership agreements set the terms for two or more parties that plan to operate a business together. They cover terms such as profit-sharing, roles and responsibilities, decision-making processes, and conflict resolution.
Non-Disclosure Agreements (NDAs)
NDAs protect sensitive information shared between parties as part of a business arrangement by restricting its disclosure to third parties. They are common in business negotiations, partnerships, and employment relationships.
Statements of Work (SOWs)
SOWs outline the scope, deliverables, timelines, and responsibilities for a specific project or service. Parties often use them alongside service agreements to clarify expectations and project requirements.
Business contracts come in a variety of forms and entail myriad challenges, from capturing the parties’ goals clearly to including custom clauses for specific industries and jurisdictions.
That can be a lot to manage, but it doesn’t have to be difficult. BoostDraft provides a simple, practical solution that immediately makes contract review and drafting more efficient by automating much of the rote work that can bog down negotiations and introduce errors into commercial contracts.
Ready to see how you can boost contract creation with BoostDraft? Schedule a demo today!