July 5, 2024
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When you grow an innovative company, selling to customers that are bigger than your company is both a blessing and a challenge. Often, such big player wants to amend your sales contract or force you to accept their general purchase conditions.
This means the contract material must first be reviewed and then negotiated. In this blog, we focus on what should be reviewed and in which format.
Contract reviewing is essential, but the time available to perform and review them is limited. Moreover, the more detailed they are, the longer they take and the costlier they are. Therefore, the key question is how to calibrate the effort.
Asking these questions will help you:
Do you want to negotiate one topic, or are you willing to discuss everything? There are three main factors to consider:
For some highly innovative companies, there is a secret format they love that we use for efficiency: the red flag reviews.
Simplicity is the ultimate refinement. We advocate limiting contract reviews to what matters most to your business. As a default solution, we recommend pre-selecting, before the review starts, the list of key topics on which you want assurance that your interests are covered.
Then use one of the following formats:
The second format has the advantage that with the right procedure, a proper amendment can be generated quite easily, leading to additional time savings.
When you need fast, high-level feedback on the contract that you can snap in an email;
Useful if you have the document in an editable format such as MS Word. This is ideal for targeted or extensive reviews. However, extensive changes can make the document barely readable;
Especially useful when you have to review a PDF and don't have many changes to propose;
Allows you to compare the original text and the modified one. It includes some legal design elements;
A proprietary format used at GOlegal to speed up the interpretation of long and detailed reviews. It includes many legal design elements.
Depending on many factors, the right approach to contract reviewing will differ. When you benefit from the advice of a pragmatic legal advisor, you will get more insight into the battles you should pick and those you should discard, as well as the format best adapted to the review at hand.
In all cases, it is important to standardize this kind of operation to speed up and enhance the quality of the work and facilitate its communication to internal stakeholders.
If you feel that contract reviewing is an area for improvement in your business, let's talk and see how your process and overall approach can become more efficient.
📞 +32 2 880 82 69
