Never Do Business Without a Contract

Question:
I don’t ask my customers to sign contracts, and now a customer has changed his mind about the color of his countertops and won’t pay for them. What can I do?

Answer:
While you can attempt to collect payment yourself, it’s doubtful you have much legal leverage to get paid. Often verbal agreements don’t hold as much weight as a written contract, and details of what’s to be done and how much it will cost often get misconstrued or even forgotten. It’s unfortunate that this happened because there’s little you can do other than to try to reach a compromise with the customer or move on.

Doing business without a contract is risky, and this example highlights the importance of having a well-written contract. In my opinion, a contract is an essential part of running a successful business. In some parts of the country, it’s a legal requirement for home improvement projects over a certain dollar value. A well-written contract is simply a document that clearly defines what the client and the countertop manufacturer have discussed and agreed to. It sets expectations about the product, and it outlines the payment terms and consequences of not satisfying the contract’s terms.

Contracts protect the buyer as well as the countertop maker. It should clearly define expectations, such as potential color variations, seams and maintenance requirements. Good contracts also have homeowner care and use guidelines in them, as well as a warranty (if one is offered) and the precise terms.

A contract won’t guarantee payment, but it does give you a strong legal leg to stand on should a problem arise. Having a contract shows that you are a professional and not some fly-by-night operation, it clearly defines what’s to be done and how much it will cost, and it shows that you want to make sure your customers get what they want and that they will be happy.