Stephen Nalley is the Founder & CEO of Black Briar Advisors.
Over the years, I’ve signed everything from small vendor agreements to multi-million-dollar real estate and investment contracts. Some went smoothly, while others taught me expensive lessons. If there’s one thing I’ve learned, it’s this: Contracts are negotiable—and the devil is always in the details.
No matter what side of the table you’re on, negotiating key terms isn’t about being difficult or greedy; it’s about protecting your interests, setting clear expectations and reducing the risk of conflict down the line.
Here are seven key things I always negotiate in a contract and some insights I’ve gained along the way.
1. Payment Terms
Let’s start with the money. I never sign a contract without clarifying how much is owed, when it’s due and what happens if payments are late. Whether it’s a service agreement or a product supply deal, unclear payment terms can tank cash flow fast.
What To Look For:
• Net 30 vs. Net 60 vs. upfront payment
• Late fees and interest
• Milestone payments for larger projects
• Refund policies (if applicable)
Tip: If you’re the one getting paid, try to get some funds upfront. If you’re the payer, tie payments to performance or delivery milestones.
2. Scope Of Work
You’d be surprised how many contracts gloss over what’s actually being delivered. A vague scope of work invites miscommunication and unmet expectations.
What To Look For:
• Specific tasks or deliverables
• Deadlines or timelines
• Who’s responsible for what
• What’s not included (this is just as important)
Tip: Always get the scope in writing—even if it’s attached as an exhibit. Clear is kind.
3. Term And Termination
How long does the agreement last? How can either party end it? These are questions I never leave unanswered. I’ve learned the hard way that getting stuck in a bad contract is worse than not signing one at all.
What To Look For:
• Automatic renewal clauses (watch out!)
• Termination for cause vs. termination for convenience
• Required notice periods
• Exit penalties or conditions
Tip: If you can, negotiate for mutual termination rights so you’re not stuck if things go sideways.
4. Liability And Indemnification
This is where the legal language gets thick, but it’s also where I’ve seen major risks shift. Indemnification clauses determine who’s responsible if something goes wrong, like a lawsuit or a breach.
What To Look For:
• Mutual indemnity (not one-sided)
• Reasonable limits on liability
• Exclusions for gross negligence or willful misconduct
Tip: Always read these clauses carefully and ask your attorney to explain them in plain English. This is where many businesses unknowingly take on way too much risk.
5. Confidentiality And IP Ownership
If you’re sharing sensitive information or creating anything of value, this is nonnegotiable. I’ve worked with developers, marketers, writers and consultants—and I always clarify who owns what.
What To Look For:
• Clear confidentiality provisions
• Ownership of work product
• Right to use logos or testimonials in future marketing
• Limits on how confidential info can be used or disclosed
Tip: If you’re paying for work, you should own it. Make sure the contract reflects that.
6. Dispute Resolution
No one wants to think about conflict when signing a new deal, but smart businesspeople plan for it anyway. I always negotiate how disputes will be handled before they arise.
What To Look For:
• Mediation or arbitration clauses (instead of court)
• Jurisdiction and governing law (especially with out-of-state parties)
• Legal fees (Who pays if there’s a dispute?)
Tip: Arbitration can save time and money, but only if it’s fair and mutual. One-sided clauses are a red flag.
7. Performance Standards And Remedies
Lastly, I focus on what happens if the other party doesn’t deliver. It’s not enough to just say “X will happen”—what if it doesn’t?
What To Look For:
• Minimum service levels or KPIs
• Cure periods (time to fix problems before termination)
• Penalties or refunds for nonperformance
Tip: Put teeth behind your contracts. A contract without consequences is just a wish list.
Final Thoughts: Contracts are business relationships on paper.
Too many people treat contracts like annoying formalities. But a good contract is the foundation of a successful relationship. It protects both sides, sets expectations and gives you leverage when things go off the rails.
If you’re not sure whether something is negotiable, ask. If a clause feels unfair, flag it. And always—always—read the whole thing. Better yet, have a trusted attorney review it with you.
Remember: You don’t get what you deserve—you get what you negotiate. So, negotiate wisely. Your future self will thank you.
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