Contracts in the Time of Corona - Scenario Series
This is Part II of our series around the types of contract situations we are getting around the Coronavirus. If you missed Part I, check it out HERE. I know there is a ton of uncertainty around payments and money right now, but knowing where you stand with your clients can bring big relief. This is why contracts are so important during a time like this! Read on below for some more scenarios that you may be running into right now! (p.s. This is not legal advice, just education!)
Scenario: Your client is late on a payment
What to do
This is a tough one. It’s a hard time for everyone and we certainly want to be sensitive AND YET we are still running businesses. Now is the time to do what you would normally do in this case - reach out, see if they need to update their card and remind them that payment is due.
If they respond and state they are unable to pay, now may be a good time to offer some flexibility. Perhaps an extended payment plan option or something similar will do the trick. In this case amend the contract to reflect it and make sure you both agree in writing to the new terms. This is a smart legal move because it means your client will be able to fulfill their obligations in terms of payment and you won’t have to spend the time or money trying to go after them.
If your client has gone radio silent, sending a demand letter or contacting collections can be the next legal steps. As long as you have the signed contract outlining the payment due, you have some strong legs to stand on.
Escalating something legally can be a good move but it’s something you should talk to a legal professional about before doing so, if you are thinking about, let’s chat!
Scenario: You have no contract
What to do
Unfortunately without a contract, you really have no support or guidance and are really at the mercy of your client. If they want to stop your package you don’t have a policy against that. If you were planning an event and they decide they want a refund, you have to give it to them. Contracts are like our parachutes and without them, businesses don’t have much protection. Sadly, there will be some coaches and online business owners that lose a lot of sales and clients during this time. Hopefully one of the lessons will be on the importance of contracts, it’s one of the most vital things in your business and this situation is exactly WHY!
Contracts are about way more than just keeping your $$$ (but hello, nice benefit!) Contracts also:
✔️ Protect your sales and intellectual property
✔️Outline the terms of your relationship and how you get paid or give refunds
✔️ Set up boundaries
✔️PROTECT YOU FROM GETTING SUED (no contract + spending $150k+ in court can sink a business very quickly)
If you need a contract like yesterday, head over HERE to get yours today.