When entering a business relationship with a new customer, having shared expectations is important for preventing future conflict between parties. Below is an overview of product and services agreements and their benefits.
What is a Product or Service Agreement?
Product and service agreements are written contracts between a client(s) and a product or service provider. They can be used for one-time deliverables or ongoing partnerships. Within the agreement is an explanation of the services provided and the price and payment terms. Otherwise, what is included in a service agreement will vary depending on the needs of the business and customer. These can include topics such as intellectual property, indemnification and limitation of liability, confidentiality and non-disclosure, non-solicitation of customers and employees, etc.
Why Have an Agreement?
Product and service agreements provide protection for both parties by creating enforceable guidelines around items like payment and timelines. They can also account for unexpected problems that arise by clarifying procedures for items like delays or terminations.
These agreements also assure both parties that they will get the work and fees they bargained for in the time frame they expect. By creating a written, agreed upon reference point with clear definitions, misunderstandings are far less likely to arise.
Final Thoughts
Businesses should consider using product and service agreements to define customer transactions. A business attorney can help a business protect itself by drafting an agreement that correctly defines the customer-company relationship and includes provisions tailored to the business’s unique needs.
For more information on this article or business law in general, please contact Albee Law PC at (312) 279-0115 or by email at info@albeelaw.com.
