Contracts are non-negotiable elements of any business, whether you’re a graphic designer or a personal trainer.
But legal matters are scary. Many of business owners - both seasoned and brand new - are intimidated by creating client contracts because they’re unsure of what to include, how to word things, and whether they’re going about it correctly.
Christina Scalera is an attorney for creatives and a pro at explaining legal matters simply, and she joined me for last week’s Ellechat webinar to share how contracts can improve your client experience.
Christina and I discussed:
- Why contracts are actually not so scary
- How to find and use a contract that protects your business and gets you paid
- The top things you didn’t think about including in your contract
- How your clients benefit from your contract (and how to use that as a selling point)
- What you need if you only have a product based business and no clients
If you’re feeling iffy about your contract, this webinar replay will be incredibly helpful for you.
You can watch the replay by registering through the Crowdcast window below, or keep scrolling and take a look at the transcript.
Transcript
Lauren:
Hello everyone. Welcome to this week's Ellechat on how contracts can actually improve your client experience. I'm really excited that my friend Christina Scalera is going to come on and join us today to tell us more about contracts, which can be a scary thing. It doesn't have to be scary. Hopefully after this hour, you'll be a lot less intimidated.
Christina:
Hello!
Lauren:
Welcome. Thanks for joining us. I was just telling them how when I got to meet you in person, and actually you were talking about contracts, your presentation was on contracts, and there were many things I found out I was doing wrong, and a lot of people can be intimidated by contracts, so I knew that I needed to bring you on so that you could share your wisdom with the audience as well. So thank you for joining us.
Christina:
Oh my gosh. Thank you so much for having me. It's so great to be here, and it's such a great time of year to talk about contracts because the weddings are slowing down. I know not everybody does weddings here, but hopefully you're able to breath between now and next week, which if you didn't realize in the US is Thanksgiving, which is kind of a big deal. I'm really excited to talk to everybody today. It's a great time to be doing some reflection and some investing, whether it's time or money in your business, and just take a minute, talk about what's going on and take a step back. It's great.
Lauren:
Yeah. I know for me, I leave some time at the beginning of the year and the end of the year, to re-evaluate and clean things up, especially when it comes to contracts and especially now that I've learned that I am doing a few things wrong, going back and fixing things, so that just in case something happens, I'm covered.
Christina:
Yeah, for sure. Let's just ask the audience, I know I asked, what are you guys using for your contracts right now? Hello Bonsai, HoneyBook ...
Lauren:
I saw some HoneyBook.
Lauren:
Before we get started, what are you all using? You asked what are they using for their contracts.
Christina:
I'm interested to see if people are doing electronic contracts, or if they're sending PDFs or what's going on.
Lauren:
Adobe Sign, paper contract. This is good to know. I know personally, I use 17hats. I started with 17hats. I recommended them in a blog post, and apparently for every person who went through that link, I get a free month of 17hats.
Christina:
Oh nice.
Lauren:
Now, I have 17hats for life. Now because they have an e-sign feature, I use them for ... Yeah, I use them for contracts.
HelloSign. Adobe Sign. Awesome. So this is good to know. So Christina, before we dive into all of the content, I want to know how you got started. I already know. I want them to know how you got here with your business.
Christina:
Yeah, for sure. I would hope it's an encouraging story. A year ago, I didn't have any of this. That's really exciting that I've been able to fortunately meet people, Lauren, who I was following for years. She's such a girl crush of mine. This is really cool to be here. Yeah, I was a corporate lawyer, and decided I wanted to change. Raise your hand if that's your story.
I desperately needed a change for a couple of reasons and decided to go in the total opposite direction. The business I decided to create was a private yoga business. So I was going to go to people's homes and teach them yoga and charge a lot of money for it. That actually does not compute. That just didn't take off, but in the process, I had to do my own graphic design. I unfortunately bought a custom website because I didn't know templates existed. It was a good thing in the end, because I got to see how they built this WordPress website from scratch on the back end.
I learned a lot about building websites, learned how to do all that kind of stuff on my own. Thought what could I do with the Rising Tides Society which is coming up, and they've just stared. A lot of different conferences, workshops were getting out there. Went to a couple of those. For a while, I thought I wanted to be a graphic designer, which fortunately for the world, that didn't happen, because I'm not great at that. I thought I wanted to do everything, calligraphy, all of these things I really enjoyed doing, and so I also along the way was encountering all of these creative professionals like you guys.
Just seeing all of the struggles they were having. There was a pattern when they would find out I'm a lawyer. "Oh my gosh this is happening. Oh my gosh this is happening." It always typically revolved around contracts, setting up their company, and maybe some questions about their client relationships. Those things I could help people with and it felt really good. I could also do things like go to the national stationary show for a client, and keep blogging and writing about business and writing about legal topics, which I love to blog.
So I could continue to do the things that I loved, just in a different capacity that supported others. So it was a win-win-win for everybody and myself obviously. That's how I got started, and now I've been helping literally at this point, hundreds of creative entrepreneurs with contract templates or one-on-one legal services or business strategy. All kinds of different things that are really helpful for them to move their business along and take it to the next level.
Lauren:
Yeah. I love, too, that you have experience with the creative side of things and legal. It's extremely helpful for all of you who are tuning in today. Christina has awesome wisdom to share with us today especially about contracts. They're not so scary, and they can actually improve your client experience. Let's just dive right and. You ready?
Christina:
Sure!
Lauren:
All right. Let's start with why are contracts actually not so scary?
Christina:
Yeah. Contracts aren't really that scary. I know you guys are like, "Whatever, you're a lawyer. Of course they're not scary to you." They're really not scary to me because of the way that I look at it. I encourage you guys to reframe them in your own mind and your own business. The way I look at contracts is they're an agreement. They're a relationship with another person or people. We're not serving a client. We're serving a person. We're not just working with another vendor. We're actually collaborating and creating something really beautiful or helpful or unique in this world.
I would encourage people to think about contacts in a way that it's a relationship builder. What I mean by that is this document solidifies and lists out the responsibilities of your relationship. That's all it does. It's not like eternally condemning someone to a certain life path or whatever. It's a list of what your expectations and your obligations are on both sides so that you both have a really clear understanding of what it is that you're agreeing to do.
For example, I will design your website, and in exchange you're going to pay me X amount of dollars, and that's going to happen by X date. That's all it is, an agreement of what we're going to be doing together.
Lauren:
Awesome. So what are the circumstances where you need a contract? There might be people here who don't have a contract yet and don't understand their need for it. So when do you need a contract?
Christina:
This is a good question. It's a great question because contracts are inherently not free, and they're decent, or they're for like "I don't know if this is okay. I just put this together from everything I found on Google." It's always a question that I get is when is it the right thing for me to invest in a contract? Whether that's a time investment or a financial investment in a template, a lawyer, whatever that looks like for you. The answer is always as soon as possible.
I know that's the worst answer ever. I know you're like, "No, well what month of my business?" It really is important. This is the number one thing I suggest people have because even before you have your LLC, even before you have any clients, it's important that you have a contract so that when you do get that first client, you're able to send that contract to them like that. If you don't have something in place, even if it's not the best, even if it's not what you're going to need in eight months, if you don't have anything to send them that could solidify and memorialize that relationship into one solid place, then you're one, not going to look professional, and two scrambling around for a day or two trying to find information. You may hire an attorney, and that takes a long time. That costs a lot of money.
You could just buy a template. Again, even if you buy a template, you need to do some research and figure out what's the best template for your business especially if it's like a hybrid business where you're doing graphic design and web design or a wedding planner that does florals. Again, what does that look like for you, and how do you create something that is a good fit for your business?
So as soon as you can starting to think about that contract, getting one, getting it into place, knowing you're going to make changes later, but it's an upfront investment. Even if you change your business later on, down the road. Hopefully, it's well written enough that you can just change the services in it and continue to use it. As soon as possible. It's the first thing I suggest business owners invest in.
Lauren:
Yeah, so as soon as possible, and you should be using a contract with every client, right? Just make it a rule of thumb to use the contract every time? How do you go about knowing when you need a contract?
Christina:
If you don't care about getting paid, you don't care about what happens to your intellectual property. If you're a graphic designer and you create a logo for them, or you are a copywriter, you write copy for them. If you don't care what happens to that, or you're a consultant and you share materials with them. If you have no interest in the outcome, you don't care if they actually pay you, then you probably don't need a contract. If you want to get paid, if you want this to be a real working relationship where you have expectations and they're met. Whether that's I'm doing this for you, and I expect to be paid, or I expect you to keep this confidential until we move further along in the project or whatever it is. When those expectations are there, it's a good idea to have a contract.
The other reason why you would have a contract is to continue to have a relationship with the other person or company on the other side of things. The way that this looks is if you don't have a contract in place, it's a he said, she said. It's, "Well in this email you said that and the other thing." The contract eliminates all that, and it's a lot easier to have a conversation where you say, "Well actually in this contract that you signed, you agreed to this." Versus a conversation where you are like, "Well you know what last May you said you were going to pay me $500, now you're saying it's only $300. I really need that $500." The contract gets rid of all of that. You just say, "No, you agreed to pay me $500 by November, so I need you to pay me."
You need to protect the relationship and also your interest coming out of it, so whether that's financial or some kind of intellectual property or some kind of process that you're sharing with the person. Maybe they're an independent contractor for your business, like a VA, and you don't really want them going out and telling the world this is exactly how I run my business. If that's proprietary information to you, then they sign a non-disclosure agreement, they sign some kind of confidentiality clause in their independent contractor agreement. If they go out and tell the world, there's consequences and some pretty severe ones they've agreed to. Those are the situations.
Lauren:
Absolutely. And two, something that we talked about, Christina actually joined me in module six of my Freelance Academy course to talk about the legal side of this and contracts. Something that we discussed there, too, is that contracts make you look a lot more professional and get people to take you seriously. If you're having trouble in your client relationships where people aren't turning things in on time and not paying you, a lot of times it can come down to not having a contract. Like you said, you can go back to that contract and say, "No, this was due at this time. This was how much you were supposed to pay me. This was when you were supposed to pay me."
Not only that because that sounds like contracts are only for us, but they also protect our clients as well and they hold us accountable and set expectations.
Christina:
Yeah, that's exactly right. Where I see this happen a lot is for example things happen. I actually canceled my wedding. I broke up with my ex fiancée, and I had booked some vendors. What happens there? I had to go back and look. Maybe I was in a different mindset when I signed the contracts, but that was a really big help for me to not be guessing at what I was losing. It was very nice and reassuring for me as a client to go back and say at one o'clock in the morning or whatever time it was to look at these contracts that I had signed and say, "Oh okay, I get money back. Oh I don't get money back," and start moving on and planning from there.
Maybe in your situation it's not as extreme. It's not like a broken wedding or whatever. Maybe it's a graphic design client that you just don't click with anymore or they maybe lied to you or they're not giving you things on time. So going back to your contract and saying, "Listen, I can cancel this contract without a refund to you because you're not giving me things on time when you're supposed to. It's holding up my other clients. It's driving me nuts." Whatever the situation is, just having something in the contract that is something that you can go back and rely on is always more helpful that just blaming your clients for not getting things to you and looking unprofessional.
Lauren:
I know, too, I've had people ask me in the past that they're working with a friend, or that they really trust the person that they're working with. I'm sure you have come across this a million times where something might seem nice at the outset. A client might seem like your ideal client, and then something goes wrong, and you didn't have a contract there to protect yourself and you're out hundreds, thousands of dollars. I love, too, that you say it protects the relationship as well, just set some expectations on both sides. It doesn't have to be scary.
Christina:
Right.
Lauren:
It can actually be the opposite.
Christina:
The analogy I use all the time is a toy box.
I don't have any kids, but I have a nephew. We have this toy box for him at my place. The toy box has toys in it, anything that he would want to play with. When he comes over, it's toys over, all over the room everywhere. We're like, "Where's this Lego set? Where's this donkey plush toy? Where's this dinosaur toy?" Whatever it is. We don't know where anything is. That's what our business looks like when we don't have contracts in place or we don't have really good contracts in place. We're relying on emails and text messages and everything's everywhere, and we don't know where to go to find the information that we need, or our clients don't know where to go. It's just a mess.
Instead, it doesn't have to be perfect, but you just need to pick all those toys up, all those messages and emails and everything, and put it all in the toy box, all in your contract, so that you have it in one spot. You can always go back and reference that one document. You don't have to go all over the internet and try to find a conversation from six or seven or 12 months ago. So thinking about your contract as a list, as something that will build your business by outlining exactly what it is that you're providing to your clients, and then on the other side what your clients are getting out of the relationship. You're not just taking their money. You're providing them with a service that they need, that they want.
Lauren:
Right. Absolutely. When it comes to forming a contract, do you recommend starting from scratch? Do you recommend finding a template? I know you offer templates. Now that there's an understanding that yes, you do need a contract always, where do you start with creating a contract?
Christina:
Even as a lawyer, I go and I find templates. Obviously, I know what to put in those templates. I have my own checklist that I have that your Freelance Academy students get access to that checklist. It's important not to reinvent the wheel, one because you'll drive yourself crazy, and two because you're not an attorney. Even as an attorney, whenever I have a new contract and not so much anymore because I have this, but when I was first starting out, I went to my attorney friends, and I said, "Hey, here's this agreement that I have. How do I do this?" I used the templates that they had, and knowing the industry, like understanding things about floral design or graphic design, whatever it is, and what I thought needed to be there. Obviously when I hear stories, or when I see things, I'm like oh I need to change the language there or add something. So with my templates, I'm constantly improving them and tweaking them.
Whatever you guys decide to do because I know not everybody can afford that kind of investment just yet, but secret, not secret, there's going to be a sale next week. Black Friday's coming. I just purely do that because I know people are starting out and they can't afford maybe a $250 investment right off the bat. Twice a year I offer the opportunity to invest in their business without spending the full amount.
Lauren:
So that's Black Friday. Next Friday.
Christina:
It's starting on Black Friday.
Lauren:
Good to know. Aren't you glad you joined in today?
Christina:
You guys are the only ones that have heard that from me. I've been hinting about it on social media and stuff. It's a secret, and it's not. Whether it's with me, there's another attorney I recommend all the time. Her name is Autumn Whit-Boyd. She's got templates. You could go onto Legal Zoom. Just know that it won't be custom or close to your industry or whatever it is that fits your budget, fits the amount of work that you want to put in. Find one that works for you is what I recommend.
I even recommend taking it a step further. Putting it into an electronic platform. I was asking you guys about what kind of electronic platform you have because I think that's really important. The reason why it's important is because this Ellechat today is all about improving your client experience, and I think there's nothing you can do to kill your client experience faster than to have a bad contract experience. I'm usually the person that's like, "Nothing's really bad. It's just different." But, you can have a bad onboarding experience. You can lose clients. You can set them up for failure, just not have a great experience. That carries through your relationship.
That's what we want to avoid, especially when it's so easy to avoid. What I mean by that is you go out, you get your contract. Again, we're adding to it, it's not perfect. I really emphasize that because I think professionalism is more important than perfection. Just getting something that is good for you as a professional is more important than having the perfect contract which doesn't exist. Once you get some kind of template into place, getting that into some kind of electronic platform to send to your client, hopefully they can open it on their phone and sign it with their finger or type their name in. In the United States, that's totally legal. Actually the court systems are all moving online and encouraging that kind of behavior. The only thing I wouldn't do of course if you're selling property. That's not what we're talking about here, though. Or writing a will or a trust or something.
What we're talking about here is client contracts. In that case, it's important to have something where you can just send it off, your client can look at it. They can review it. They can see it, they can maybe even make comments on it. They don't have to download it or print it or send it back to you or fax it to you. If you were faxing, it's time to rethink your client onboarding process because it should be so easy. Nothing should be easier than to book you as a service provider when you send your clients contracts. Hopefully using something like 17hats. Can you give them the link that you have to 17hats? Because that would be awesome.
Lauren:
Absolutely.
Christina:
I think 17hats is a great platform. I am a legal consultant for HoneyBook. I love HoneyBook. They even give you a general services contract that was created by an attorney. Anyway, there's lots of different options out there for you if you do want to do electronic service provider, I just gave you a few options. They're all encompassing.
Christina:
They will actually do the invoicing. If you only need a contract or just want to send contracts, we're seeing some here in the comments, HelloSign. I haven't tried Proposify. Adobe Sign, I actually don't like because it's still ... They haven't gotten it to the point where you can just ping it back and forth like HelloSign or Bonsai Sign. I think Lauren added the 17hats link for you guys if you want.
Lauren:
Yeah.
Christina:
I think what’s hard is modernizing your onboarding process with your contract.
Lauren:
I can say, too, Christina and I had a contract, and when she sent it through HoneyBook, you can also pay right after the contract. It was really easy from my point of view to look it over, sign it. It would have been a much bigger hassle, and I've worked with people in the past where I have to print it out, and then I have to scan it in and send it in an email. I love that you say that. Both from a user experience, and on my end, it's so nice to not have to keep up with paper contracts. I can have it all in one place.
Christina:
I just added my HoneyBook link. That's an affiliate link by the way, guys.
Lauren:
Yeah, mine is, too.
Christina:
I would recommend it anyway. HoneyBook does work in the UK, as does 17hats. All we're talking about are SAAS systems, so software-as-a-service. The software we're talking about is this client booking software, so Quickbooks is a SAAS, and Convert Kit. All of these kinds of things are SAAS services, and they work everywhere.
Lauren:
Right. So helpful. Like I said, mine is just free months to 17hats.
Christina:
Mine is allegedly money, but I've never seen it, so I don't know.
Lauren:
Yeah. Those are both great. And you said DocuSign, HelloSign.
Christina:
HelloSign lets them do three contracts per month for free, which is great, and it's a beautiful interface, so I like HelloSign. DocuSign, I think, is a low monthly payment, HelloSign, too. I haven't use Bonsai Sign, but a lot of people do like Bonsai Sign.
Lauren:
It's good to have the options and check those out. Definitely if you have a paper contract, it might be worth, well definitely worth for your client experience, and just to keep everything simple doing it online as well.
Christina:
We were talking in your course about how easy it is to update. Once you have your contract typed into your computer and one of these SAAS systems and even a Google Doc, you can always go back and update it. It's really really easy because then you can access the most modern version of that contract. It's always something you can copy and paste, which is really nice. Just a little insider tip.
Lauren:
Yes. You will make updates. It's kind of inevitable. Even just changing out the amount you're paying and the process. You're going to make tweaks, too, but also just learning from trial and error what you need to include in your contract.
Christina:
Right. Clients ask for extra stuff, more than they've paid for. That's crazy, Lauren.
Lauren:
Yeah. Imagine that. Now that we've talked about contracts and how to set them up, what are the top things that people don't usually think about including in their contract?
Christina:
Yeah, that's a great question. I think some of the things they don't think about including are the number one thing is an example. If you're always running into a certain situation, give an example, and tell them how it turns out. If you find clients are always asking for extra hours and not respecting the rate that you've quoted, that only includes a certain amount of hours. Maybe you're a coach or a graphic designer or something like that on retainer, give them an example. Like example, you get 10 hours with this package to be used over the next three months. If you go over these hours, you will be charged at a rate of whatever my hourly rate is per hour.
So for example, this or that or the other thing. Use examples of real life things that have happened to you. They don't have to be super detailed, like you are named Heidi and you do this thing. Just generically. It doesn't have to be like you're exposing your past clients, but examples are really really helpful. It helps humanize the documents so your clients trust you more. They can probably read between the lines and see that this is a situation that's happened before and hopefully have respect and appreciate that you're taking care to avoid that situation from occurring again, from both sides of the coin.
I think that examples are the number one thing that people leave out of their contract because they want it to be this very formal legal document, and if we have an example, that's weird. The new school of contract drafting actually includes a lot of examples. We were encouraged in law school. I was fortunate to study with the lady that actually wrote the book on contract drafting that's used in every law school, almost every law school. She encourages everybody to use examples in their contracts, where it's like all right, what's really going on here? And just breaking it down in layman's terms and real life situations.
Lauren:
Yeah, I love that, and I wouldn't have even thought to do that because like you said, with contracts, it's so much legalese, legal terms, but that is so helpful. I would think, a client perspective, they would appreciate that you're breaking it down because it might not be so clear for them. That's awesome.
Christina:
I would say that that's that number two mistake is that using legalese might sound cool, but if a client comes to you, and they ask you, "What does this mean?" and you can't explain it, that doesn't look good. That doesn't look like a professional. It might be if you're advanced enough to have somebody, like a lawyer or somebody that you can pay for a couple hours to go through your contract with you or update your contract, it might just mean some Googling, hopefully not frantically. You do it before a client has these questions.
I like to stay away from legalese. For example, anytime I find myself writing herein, as in we will address these concerns as contained herein, I change it to in this agreement. Anytime, I'm like okay, follow the payment plan as herein. Instead it's follow the payment plan as set forth in this agreement. That's just easier for people to understand. If you don't have a legal background, hopefully you're not thinking in legalese and converting.
Lauren:
I don't normally think herein.
Christina:
Yeah, it might just be a simple thing where you break it down and put it in language that you understand, so that when a client has a question, you can competently and confidently answer that question for them.
Lauren:
That's helpful. Irene said that Smashing Magazine has some examples. If anybody has that link and wants to add it in here of breaking terms down, that would be really helpful.
Christina:
Yeah. I heard it was cool.
Lauren:
If you haven't written a blog post on that already, Christina, there's a blog post idea.
Christina:
About examples in contracts?
Lauren:
Yeah!
Christina:
I'll write one for you guys. I can't promise when it will come out.
Lauren:
No. I'm just throwing things out there. I'm always on the lookout for blog post ideas.
Christina:
Right!
Lauren:
So we said using legalese and also using examples, or not using legal terms, but breaking it down, and then using examples. What are some more things that people don't think about including in their contract?
Christina:
So the one thing I would say people don't think about including is actual breakdowns of plans, services, payment plans, fees. It's really really helpful for me to see something where it says ... Maybe I can provide you with an example of this somewhere. Basically when it says fee, $500, due by July 4th or whatever, 2018. Whatever it is, and then just having a chart. Payment number one costs this much, due by this date. Then using exact dates and exact numbers. That's really helpful because it's much easier to look at something like that in a chart form than it is to say in a paragraph, which is for our brains, harder to read anyway. Then to say okay, wait, 30 days from the first date of this whatever. It's so much harder to calculate it out days, and is that business days, is that calendar days, is it a leap year, whatever's going on. Just write the dates, write the numbers. Try to make it as simple to understand as possible. That will help your clients.
Obviously the goal of this we're talking really in depth about our contracts, but the goal of all of this is to have a great experience with all your clients so they go out and refer you to a million people and you have more clients. Keep in mind when they look at something, make it easy. You read blog posts that have section headings. So you have section headings in your contract. Just make it easy to read.
The third one, I would say is just make things really really easy. If it's not intuitive to you to look at a certain section and find something, then if it makes more sense to you to have a certain heading somewhere or to break a paragraph up into two different revisions, it doesn't change the contract, it just changes how easily you can reference it. I would say the mistake or the thing you could easily improve is just making things really simple by having these dates, exact charts. You can do it with services, too, where you have like 10 hours of coaching provided by date. Or 10 hours of coaching and then everything else that's included. Access course modules, access to me via email, Facebook group. Kind of like you might even see on a sales page of a course or something.
Lauren:
Right. Just spelling it out really clearly. I know, too, I wouldn't want to read a paragraph of when due dates are. Having it in a chart would be so much easier, but I don't normally think about charts in contracts because again, we have it in our mind, I guess, how it's been done in the past. We have these preconceived notions about contracts, so it's helpful to know that yes, and fact, you can have a chart or a table in there.
Christina:
If it makes it easier to understand, because again, all a contract is, is an agreement. If you don't know what you're agreeing to, then do you really have an agreement. That's where problems creep in. If you understand what you're agreeing on either side of the table, it's a better situation all around.
Lauren:
Yeah. Speaking of these things to include in your contract. How can your clients benefit from your contract? How can you use it as a selling point even? We've mentioned here and there how it improves the experience. What are some benefits? Some clear benefits?
Christina:
Definitely. I love how you asked how it can even be used as the selling point. I think the number one thing, and we talked about this before is that it makes you look professional when you get off the phone you can say, "I have my contract," and you send it to them right away. You're not getting home, scrambling for a contract, and sending it them forever later. By that point, they've already booked some other service provider or whatever's happening. Clients are just like us. They want things fast.
If you can give it to them really quickly, that shows you're professional. Then when it shows up on their doorstep or in their inbox, whatever it looks like, hopefully not on their doorstep. When it shows up on their inbox, and they're able to take a look at it, sign it, it's not just this one little pager, okay you pay me this, I give you that, cool, let's sign it, bye. But actually an entire agreement. Like I said, the toy box that has everything in it. What happens in the event of a cancellation, if you're a photographer, what if there's a weather delay? Any kind of situation is detailed.
All of the what ifs are taken care of as best as possible, that gives the client a lot of confidence in you as a service provider because they don't necessarily understand what it is that you're doing for them. The more you can take them by the hand and walk them along with you, show them this is what I do, I've done this before even if you haven't, and you have a great client contract that alludes to the fact that you've done this before because you have web articles or you have charts. You just know what you're talking about, and you know what you're doing with them. You can point that out.
I think the last way you could really use it as even a selling point is in the presentation. That's why I think these electronic companies are so important because we take it for granted, as online service providers that everybody is using this and used to this kind of stuff. I can't even tell you how many PDF contracts that I get, and it just drives me crazy because there's such good, cheap solutions out there. When you are the service provider who is sending your client a contract that they can read immediately, and they can then highlight things or comment on it right on their phone when they're out with their friends at a coffee shop, whatever, and they can send it back to you signed with their finger, you stand out from the competition who sent it to them in a PDF or said, "I'm going to send you the contract," and spent the evening on tons of free websites or something then they get it in a PDF and it has typos or whatever.
When you can streamline it to just be able to send immediately and through one of these platforms, it gives your clients a lot of confidence that you are not only a competent service provider but that you also are aware of what the experience is like for them. The illusion or the assumption is at that point is, "Wow, she's this organized and this on top of it this early in the game, I can't wait to see what she does to my whatever," floral design, my website, my wedding.
I think those are all the ways you can use your client contracts as a tool.
Lauren:
I love that. I'm always saying this, and I probably sound like a broken record to those who have been reading the blog lately, and Elle & Company newsletters, but the most important thing in any business, and it doesn't come overnight, is trust. People have to trust you in order to buy from you, whether it's booking your services or buying your product. They want to know that if they're putting their money there, that they're going to be well taken care of. I think that it comes at the very beginning. The contract, you send it right before someone pays. The money is almost right there. It's the very last thing they probably see before they pay the invoice for the first payment or whatever it is. For you to look professional, and for you to look like you've thought through every possible outcome, that you've done this before, it shows them that they're in good hands.
I think some people shy away from having a long contract because they think it's going to overwhelm people, and I thought that at first. I worked with a lawyer. He drafted up a contract. I was like oh man. Are they going to want to read through all these pages? In fact, I found that they saw me as more of a professional, that I had taken those steps to think through every possible scenario, that not only I was covered, but they were covered, if I were to cancel or something like that. I think that the trust component and everything that you've said, covering your bases, goes a really really long way with people. That's my two cents.
Christina:
Yeah, I love it.
Lauren:
What about the people who are tuning in right now, and they don't necessarily have services, but they have products? What do you need if you only have a product based business?
Christina:
I love this. No matter who you are if you have a website, or if you don't website, but I'm going to assume in 2016, that everybody has websites, so forgive me.
Lauren:
Probably.
Christina:
If you are a product based business, you have a website. All of you, even service providers, should have this. It's called a terms and conditions page.
For those of you with product based businesses, you have what's called a terms and conditions or privacy policy page. That's essentially the contract that people using your website are agreeing to. When they continue to use your website, they're agreeing to whatever you set forth there. You can say whatever you want, as long as it's true, you're not going to get in trouble with the FTC here in America or whatever in your country. For example, if you're selling everybody's information that comes to your website, you can say that, and it's fine. If you say that you're not selling it and you are, then you're going to get in trouble.
Where it applies in this situation, is if you have these terms and conditions of use, and you sell products, whether they're digital or physical, what you can do is you can tell them exactly what ... If you buy something and you want a refund, here's our policy. If you go to major retailers, if you go to the Walmart or H&M website, and you go and look at their terms and conditions, it says you can return your merchandise within this amount of time. If your merchandise arrives damaged, this is what you can do. If you are unsatisfied, here's what happens.
It's not exactly the same thing as having a client service agreement, but it's very similar in that by placing an order, we assume you've read these terms and conditions that we've so clearly laid out on our website. I like to take it a step further because with digital products, it's really difficult to protect yourself against charge backs. Hopefully none of you have done this because that's not cool, but charge backs if you're not aware of it is when you place an order for something online, and then you ... Sometimes this does happen. If someone took a card, and they used it fraudulently for something, what you can do is you can call your credit card company and say, "This is a charge that I didn't make. I want my money back," or, "I ordered from this retailer, it never came. They're not responding." Shitty site or something, I don't know what happened, but they're not sending you your merchandise, you get your money back through your credit card company.
It's interesting because with product based businesses obviously you can show that it's been shipped. With digital, it's a little harder. You have to show that they've actually received the product somehow. Maybe having an email conversation with them. On my website, I actually have a box that you have to check that you agree this isn't legal advice when you download my digital products, and you're agreeing to my terms and conditions, so you've read them. I have a link to my terms and conditions. That if you're unsatisfied, you're going to contact me, not initiate a charge back before you email me first. I'm going to take care of you. Don't worry.
Those are the things you could do, whether you're selling digital or physical products. Then finally in person if you're only doing craft shows or pop up markets, something like that, it's really hard to have anything. You do have a square reader hopefully, stripe reader, whatever it is that you're charging their credit cards with. There are certain protections in place through the company. Just read the terms and conditions of the contract.
In person sales like that, there's not really a contract other than a pure exchange of money for goods.
Lauren:
Okay, so for product based businesses who are looking at creating terms and conditions, do you have templates for those as well?
Christina:
I do. That's actually my best selling template is my terms and conditions template.
Lauren:
Good to know.
Christina:
For sure, it's definitely a plug and play. You just copy and paste it. Read it. Make sure it actually applies to your business. Like I said, that's important. You can't just put something up there if you're not following that. For the most part, it's a one size fits all.
Lauren:
Awesome, good to know. Are you ready to tackle some of these questions?
Christina:
Yeah, I think they're really great questions.
Lauren:
I was reading through them as much as I could. Okay, so we're going to start with Rachel's question. She says, "What if I put the due dates on a contract and after signing it and paying the first payment, a client said that we need to move the due dates for the second and third payment because she can pay each of them two weeks later after our due date? Is this contract still valid or do I need to create a second contract for remaining payments?"
Christina:
Yeah, that's a great question. Just so you guys know, this isn't legal advice. I'm not working with you one on one. That would just be totally negligent of me to say, "You should definitely do this." These are really generic answers. Obviously, if you have a legal question, talk to a lawyer, especially if you're in a different jurisdiction than the US. This is definitely something that happens a lot, like a client can't pay, or they need an extended payment plan. They want to buy more hours from you, which is a great problem to have.
The mistake that I see people make is they send a whole new contract. That's fine, but that's kind of overkill.Today we're talking all about the client experience, and to me, that's not the best experience they could have. For example, in all my templates, I just have a little amendment thing that in writing, via email, or old school, if you want to send a letter, whatever. You're out to dinner with somebody, you just want to write it down on a piece of paper, or send it to each other, take a picture of it, via email. Whatever it looks like, just how the amendment, which is the change, is in writing and conveyed to both people. That becomes a part of the contract with both of the parties, or if there's more than that, all of the parties, agreement and permission.
That's as simple as it gets. Okay, I would like to buy 10 extra coaching hours, or I would like to buy ... Actually I didn't think I needed a whole brand redesign. I thought I just needed a logo. But I actually want the whole thing. Well great. Then you just amend the contract in writing to make sure that's a part of it. You can do that probably in 17hats pretty easily, or if you just want to include that in an email somehow. Just make sure that it's in writing, and that it included ...
That's fine if they're just moving it the two weeks. That doesn't seem like a big deal. If this is a problem that's going on a lot, here's a good example, and you could put the example in the contract. For example, in my templates, I just say if you miss a payment deadline, everything becomes due and payable. You know months and months in advance when your payments are due. I can't take that risk with you as a client, sorry. Don't miss your payment deadlines. I give you a grace period. After that grace period has passed, everything's due. Those are some solutions in that situation.
Lauren:
That's a good rule of thumb. Just to clarify, do they need to sign that amendment?
Christina:
Right. It depends on the contract that you have. If you have a contract that doesn't say anything about whether amendments can be made in the contract, it's appropriate in that situation. But if you have a contract and it says that amendments can be made by writing, which is pretty standard. Then you just need it in writing somehow.
Lauren:
They don't even need to sign that amendment?
Christina:
Right. There's just an email. As long as both of you know what the situation is going forward, and then as far as organizing that. Again, the toy box thing, I like to put it back into a box, figure out a way to get that back in the contract so six months from now when you know it's somewhere, make sure it's somewhere you can go back and reference that, whether that's a Dropbox folder, on 17hats or whatever that looks like for you. That's just a matter of organization at that point, though.
Lauren:
Yeah. Awesome. I hope that was helpful for you, Rachel. I know that was helpful for me. Thank you, Christina. All right. Jennifer says, "Is it okay to combine the information on a contract into your proposal, or is that too overwhelming for clients?"
Christina:
I do that. I love that. I want to give them everything all at once so they can make a decision. Like I said, I am not out to ever take anyone's money. Obviously, I'm an attorney, but I also do business strategy. Even when I'm just doing my consulting, it's never out to take someone's money.
I like to send everything all at once because like I said, I'm out to provide a service, not to just be like the money monster over here. I like people to have a need to make that decision and make an informed decision. I do believe that you as a client, in whatever capacity that is, you have the most information about your situation. The financials of your situation, the feelings of your situation. You are in the best position to make decisions for yourself, and I would like you to have a full picture of everything, including the terms of my agreement.
Sometimes, I mean, my partner, he just got an agreement for an SEO contract, and it was very one-sided and not okay. If he had just gotten the proposal and not the actual agreement, too, it maybe would have been a different situation where it was a bad situation on both sides, but because he got the contract and could make that informed decision, he decided not to work with that service provider. In that case, it was a pretty bad contract. I think it's good to give everybody everything that you can all at once.
One thing I will say that a lot of people don't do, and I don't know if you do this, Lauren, but I like to jump on the phone with people before that happens. I think that's way more important than do I send the contract, do I not. I think it's really important to have a call with someone and decide if they're a good fit for you, and vice versa to give them that opportunity.
At that point, I don't even think it's an issue. I don't think it's going to make a difference to them, whether you send them the contract at that moment.
Lauren:
Yeah. I always jump on a call with them, go over with them the entire process, what's included. Go over the ins and outs of the contract ahead of time, so that when I send them the contract, it's nothing new. I send them the contract as soon as we get off the phone. Just like Christina said, for improving your client experience, as soon as we get off the phone, I say I'll send over my ... Or on the phone, I say, "As soon as we get off, I'll send you my contract, feel free to look it over. Let me know if you have any questions. Once it's signed, I'll send you the invoice, and you'll be booked." Just continuing to go over these things with them so that it's very clear exactly what they're getting.
I agree, Christina. I think having the information in both places is actually a good thing. I don't think that's too overwhelming. If it is too overwhelming for them, I don't know. I don't think ...
Christina:
It sounds like you need to have a lot more phone conversations with them or maybe change your marketing messaging.
Lauren:
Yeah. A great question, Jennifer. Maria says, "Do I have to get my contract looked over by a lawyer? What can I change about it without having a lawyer confirm that it's still good?" That's a good question.
Christina:
That is. It's honestly a matter of where you're at in your business. It's funny because a lot of people who are just starting out are like, "I want to do everything right from the start. I'm going to go to a lawyer. I'm going to do this." This is coming from a lawyer, but when you're just starting out there's so many other better places to put your money as an investment than a lawyer, I think. Again, not here, but insurance, that's probably more valuable than having a lawyer look at your contract. Just having a policy in place so that if things go wrong, which accidents happen. There's something there.
Again, you are the person who knows your risk level, how risk adverse you are. So if you're very risk adverse, and you have the financials to have a lawyer look at it, that's probably a great investment. If you're just staring out, and you don't have a lot of money, then it's like a wait and see approach and adding to your own contract, and then budgeting for the attorney fees to look over your contract. Or in the alternative, finding these great attorney drafted templates. Again, whether they're mine or someone else's, there's tons of them out there at this point. Whatever works for you, and then using that going forward, and then adding as the situations arise. If you got a general contract, adding that.
If you're like two or three years into business, I don't say this to be mean, but you really should be in a place where if you wanted a lawyer to look at your contracts, you could afford that. So making maybe $1,000 investment to have them look at it. Or if things have been going really well, and you've done the, "Oh I should've thought of that. I should've thought of that," and you have all that kind of stuff in your contract, and you feel good about it, then you probably are in a situation where you don't need an attorney to look at it. You're probably in a situation where you know more what's going on and the pitfalls and the problems that you could possibly have, and the attorney's maybe, you could hire her for an hour to just add some things in or clarify some things or clear up some ambiguities.
This is the worst answer ever, but it really depends. It depends again on how high risk you're willing to accept your business. Again, if you're really risk adverse, that liability policy, if you have to choose between the two because of financial reasons. What i would say if were starting a business, what I would do is I would get a contract template, and I would get an insurance policy.
Lauren:
Yeah, that's great advice.
Christina:
If I could only afford one of those, I would get the one I could afford.
Lauren:
Two, from my experience, I started off from a template. My business started to change a little bit, and I knew I needed other things added onto my contract. So I hired a lawyer for privacy policy and all of those things. I'd be interested to hear your take on this, Christina, but we, and specifically Jake. I can't take credit for this. When we were researching lawyers in our area, he found specifically that worked with creative online businesses. He was familiar with what I would need in my contract.
I'm not going to name names, but other people in the industry who have worked with lawyers, and the lawyer has actually come to their location, and they explained exactly what they did, and when it came time to get a contract, he didn't have an understanding of what they did. I guess he didn't really listen all that well. If you do reach out to a lawyer, it might be helpful to look for someone who has experience in this area. Creative online businesses look different than other businesses. Would you add to that? Is that valid advice, wisdom, Christina?
Christina:
Yeah. There's a reason why I filled up with clients super quickly. It's because I can talk to you about styled shoots. I can talk to you about nibs and paint. I think there's a nuance to it that a lot of attorneys won't be able to provide. I'm not saying that because I'm like the best ever. I don't think that. I think it's important to find somebody that you connect with. That's the important thing. If you're just generically searching for an attorney, you could find a Google search from a website called Avo where attorneys can actually pay to get better rankings and ratings. Even on a Google search, the people that show up first are probably paying a lot of money to SEO companies, and not so involved in their communities or the businesses that their clients have.
Maybe looking on the fifth or sixth page of Google. Again, doing free consultations. If a lawyer won't offer you a free consultation, I wouldn't ... I mean 10, 20 minutes of my time to get to know somebody, that's about to invest thousands of dollars with me, that's fine with me. It should be fine for the attorney that you choose. I really believe that. I think that's a good place to make those connections and even decide if it's something that you need. You might talk to an attorney, and there's plenty of people that I talk to where I'm like you don't need me yet. Come back to me in six months. Or you actually need an account or something else.
Just finding somebody that you connect with. The only way to do that is on the phone. Ask them questions about what they do. Talk with them about what you do, and then see if they can mirror that to let you know they also understand what it is that you're talking about. There's just things that happen in your business. For example, I know that we're over time, don't kill me Lauren. There's things that happen. I didn't know that the florist is always the person footing the bill for that shoot, and everybody else isn't bearing anything financially. I would not be able to write that contract, a styled shoe contract. The reason I'm able to do that is I know they work. I know usually at the end of the day, everybody's thinking who's going to publish this? You said you'd published this. But I paid for all the florals, but I contributed the cake, but I did the photography.
Things like that, if you don't understand what's going on or if you just tried to explain even what a styled shoot is to most attorneys, they'd be like, "What?" So just finding somebody. If you as the client of an attorney are even willing to take the steps necessary to even teach that attorney a little bit or give them some articles they could read. Then hopefully they don't charge you for learning about your business. Still, just knowing that you might have to do a little bit of education first.
Lauren:
Yeah. With our attorney, I gave him access to the library and e-courses, and everything so that he would have a good understanding of what it looked like. I think that was really helpful.
We had some other questions that went unanswered. But I would encourage you all to go to Christina's site. There's also a link. You may have seen it already. It says "learn how to legalize your biz for free." Christina, can you tell them about that link and what they can access if they follow it.
Christina:
I mean obviously, I love the creative community, and I want to encourage everybody to be in business that wants to be for themselves. One way that I'm able to do that is by sharing what I know about creating a business. It's not inherent. It's not knowledge that was out there when I was looking to create my first business. I distinctly remember that. I wrote down everything that can get you started in a book. You can get that book totally for free just by clicking that link. It'll walk you through the steps of legalizing your business when you're just getting started or maybe if you haven't done that yet.
Lauren:
Awesome. Thank you for providing that.
Christina:
Yeah, of course.
Lauren:
It's such a good resource. If you go to that link. But then once you do get the free book, go back through her blog and look through the posts. It is so incredibly helpful. Christina also has a podcast. You want to tell them about that before we hop off.
Christina:
Sure. If you guys want to listen, we talk to a lot of creative professionals who are a little bit further along. We've got them to share some really interesting stuff. Her interview's coming out in December, but Emily Lei shared some stories that she's never shared before, which was cool. She has a simplified planner. If you want to get that behind the scenes peak and be like how did she do that? We have the creative empire podcast. Thanks, Lauren.
Lauren:
Yeah. You're welcome. I thought I'd put that out there as well. So many good resources. Thank you so much, Christina, for sharing your wisdom with us. The hour flew by.
Christina:
I know. I could stay on here forever. I love talking to you guys. Thank you so much, Lauren. I really appreciate it.
Lauren:
Absolutely! If you enjoyed this Ellechat, it's taking place every other week from now until the end of 2016. In 2017, we're going to pick back up to every week. A lot of just helpful information for you all as creative entrepreneurs on different topics each week. If you enjoy following along, and you want to see past Ellechats and stay up to date on upcoming Ellechats, you can go to my account. I think my little circle bubble with my face on it is somewhere around here, when y'all signed up. If you click on it, you can follow along with my Crowdcast account. That way you'll know any new time an Ellechat is coming up, or you can access all my previous Ellechats, too.
Be sure to do that. The next one, I'm actually having one of my coaching clients come on. She has started a six figure Etsy business, multiple six figure Etsy business, and she's going to sharing all of her secrets. Her name's Morgan Nield. I'm really excited about that one. That'll be two weeks from now, always on a Thurs at three p.m. eastern standard time.
Again, thank you Christina for joining us. I hope y'all have a great rest of your week. I hope to see you in another Ellechat soon. Bye guys.
