5 Tips to Avoid Jeopardizing Your Next Business Deal

Whether you’re an experienced business owner or an entrepreneur just embarking on your first business venture, there are certain missteps that you need to be aware of in order to avoid jeopardizing your corporate transactions.

Here are five tips that can help you craft your next profitable business deal:

Correctly estimate your costs. Experienced business owners usually know the cost factors that go into delivering a service or product to a customer, while entrepreneurs can struggle with figuring this out. However, even the most experienced businessperson can neglect to consider potential future costs to fulfilling a contract, making the deal unprofitable over time.

Understand agreement scope. All parties to an agreement need to understand its scope. This is particularly important for any agreement that includes licensing intellectual property and the rights and responsibilities of both parties with respect to the licensing. Make sure the contract is clear about what your business partners are receiving and what you are expecting in return.

Get guidance. If you don’t have a board of directors to look to for experienced business advice, consider creating an advisory board to help you with your business transactions. Just make sure that their roles and any compensation are clear defined, and that they are properly protected from potential litigation.

Use an experienced business attorney. Rely on an attorney who is well-versed in state and federal business law to guide you with making strong business deals. Contracts and the laws surrounding them can be complex, and an experienced business lawyer who can help you foresee potential problems down the road is an invaluable asset.

Don’t cut corners. It can be tempting for many business owners, especially if they are new to the game, to cut corners when it comes to hiring the right attorney or advisor to guide them through the deal-making process. Skimping now can cost you plenty in the future, since it usually costs a lot more to unravel a bad deal than it does to make sure it is done right in the first place.