The ideal scenario for negotiating a business deal is to negotiate terms in a way that allows you flexibility.
You'll want flexibility to change your terms with the help of a lawyer if you missed something or got something wrong.
So, here’s a guide on how to negotiate the initial terms of a business deal.
The objective is to keep things simple, avoid disputes and keep things flexible in case you need to change key terms.
Your first discussion is likely to be a meeting.
So it's best to make your intentions clear upfront, either before the meeting in an agenda or at the meeting.
You can use the statement below in your initial meeting agenda and I also suggest in follow up email negotiations.
Both parties do not intend for these terms or statements to be legally binding until they have been incorporated into a formal legal document.
You can set out proposed terms either before or after your meeting.
And these terms are commonly called MOU or Draft Terms.
The important point is to include the statement above.
Courts will look at the parties intentions if one of the parties brings a claim before a court.
You can get a lawyer’s help any time.
Based on experience, if you are going to get legal help its best to do so early so you can get your terms checked over and corrected (if corrections are needed) before a formal legal document preparation.
If you are negotiating with someone that intends for terms to be binding, it’s wise to get advice before you sign any initial terms or memorandum of understanding
It is very common for heads of agreement to be prepared by a landlord.
Usually those heads of agreement are intended to be legally binding.
So, in this case, if someone else has prepared terms like this or refuses to include a statement about the terms not being binding, then at that point it’ wise to get legal advice, or run.
Negotiations should always be fair.
And, if you are negotiating with someone that’s not willing to allow you the opportunity to get legal advice, this could be a signal of other unfair behaviour down the track.
Tread with caution.
I wish you every success in your ventures!