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How to negotiate a business contract in Michigan

On Behalf of | Nov 12, 2021 | Contracts

Michigan law requires that you negotiate contracts in good faith. This means that you must not seek an unconscionable advantage, attempt to defraud or have malice when you negotiate a contract. The goal is to find an agreement that satisfies both sides.

Ask what’s important

You could make negotiation easier on you by asking the other party what’s most important to them. They might have something that they’re either not willing to budge on or not willing to budge far on. If you are also unwilling to give on the same issue, then it’s better to walk away and find someone who’s more compatible.

However, there are some things you may want to give on to ensure that the other party is pleased with the contract. Keep an open mind and give yourself time to thoroughly think through the agreement. Also, let the other party know what matters most to you in the agreement.

Seek a second opinion

Once you have the first draft of your contract that both of you are happy with, ask an outside party for their opinion. The person you go to should have experience with contracts. They could alert you to a clause in the contract that isn’t clear enough, is a bad deal for you, or could potentially cause problems.

Follow up on their references

Not many people follow up on references, but this could provide you valuable insight on what you could expect from the partnership. You should ask the references if there have been any issues with that business or person and how they resolved them.

When you’re negotiating a contract, you want to make sure that you and the other party will be happy with it after signing it. You can reduce the likelihood of problems by following up on their references, seeking a second opinion and prioritizing what’s important to both of you.