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How to successfully negotiate a business contract

Every contract negotiation is different. The people representing the other party have their own personalities, expectations and quirks -- as do you while you represent your Illinois business.

Many businessmen and -women enjoy the dance of negotiating important contracts, but whenever you are trying to make a deal, your company’s finances could be at stake. Not to mention, a poorly worded contract can expose you to unnecessary liability if the deal sours later on.

Everyone likely has their own negotiation style, but here are some basic tips, as provided by the Houston Chronicle:

  • Prepare. Study the other party’s strengths and weaknesses, and try to identify their strategy. Meanwhile, figure out where your bottom line is.
  • Ask for clarification. Don’t leave things vague, and don’t agree to something you don’t fully understand. Dates and amounts of payment should be crystal clear to both parties.
  • Use pressure. Remind the other party of other options your business has if you and she cannot make a deal, with her company left out in the cold.
  • At the same time, be flexible. Once a deal seems to be possible, officer reasonable concessions to help seal the deal.
  • Decide whether to close the deal. You can set a time limit at the beginning of negotiations, for example by saying you have to be elsewhere by a certain time. If, by that time, no promising compromise has emerged, it may be time to walk away and explore other options.

Business matters aside, it is possible that a contract could unexpectedly violate the law or expose your business to legal liability it does not want. An attorney can help you avoid these pitfalls.

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