As your business starts to grow, the legal framework underpinning your operations becomes more complex. Scaling isn’t just about increasing sales or expanding your team — it’s also about ensuring you have the right legal safeguards in place to protect your business. In this article we detail the 9 contracts you need as you grow your business.
Here’s a breakdown of the 9 essential contracts you’ll need as your business begins to scale.
1. Shareholders’ agreement
If you’re bringing in investors or new business partners, a shareholders’ agreement is essential. This contract outlines the rights, responsibilities, and obligations of all shareholders. It sets the foundation for decision-making processes, voting rights, dividend policies, and how shares can be transferred. Importantly, it can also include clauses on what happens if a shareholder wants to exit the business or if there’s a dispute. Ensuring your shareholders’ agreement is comprehensive will help avoid misunderstandings and conflicts as your company grows.
2. Employment contracts
As your team expands, so do your legal obligations to your employees. Clear, legally compliant employment contracts are crucial for defining the terms of employment, including working hours, salary, benefits, and confidentiality obligations. Employment contracts also need to outline the grounds for termination, notice periods, and any non-compete or restrictive covenants that protect your business after an employee leaves. New HR laws are coming into play very soon, we’ve written more about what your employment contracts need to include here.
3. Supplier agreements
When you scale, the volume of work with suppliers often increases. Supplier agreements set out the terms of the relationship between your business and third-party suppliers. This could cover the supply of products or services, delivery times, payment terms, warranties, and confidentiality. Having clear contracts in place can help you avoid disputes, ensuring your supply chain runs smoothly and without legal hiccups.
4. Client agreements
Your customer base is growing and so having in place a robust client agreement that outlines the services or products you’ll provide, payment terms, timelines, and the scope of the project or work is vital. Client agreements can also limit your liability and clarify the expectations for both parties, helping prevent disputes or miscommunication. Customising these contracts to fit the specifics of your industry or services is key.
5. Confidentiality agreements (NDAs)
As your business develops, you’ll likely share sensitive information with employees, investors, contractors, and business partners. A non-disclosure agreement (NDA) protects your confidential information from being disclosed to competitors or other third parties. These agreements are vital when discussing new projects, working with contractors, or developing strategic partnerships where proprietary information is shared.
6. Intellectual property agreements
Your intellectual property (IP) — whether it’s your brand, software, or product designs — is one of your business’s most valuable assets. To protect it, you’ll need to ensure your IP ownership is clearly documented and legally binding. This includes registering trademarks and copyrights and ensuring any contractors or employees who develop products, designs, or code for you assign the rights to your company. If you’re not sure where to start, consider conducting an IP audit, we show you how to do that in this article HERE.
7. Partnership agreements
If you’re entering into joint ventures or partnerships as part of your growth strategy, a partnership agreement is essential. It defines how the partnership operates, how profits and losses are shared, and what happens if one partner wants to exit. A well-drafted partnership agreement can help ensure all parties are aligned and prevent future disputes.
8. Commercial lease agreements
As your business grows, you might find yourself needing larger office space or a new commercial property. A commercial lease agreement outlines the terms between you and the landlord, including rent, repair obligations, lease length, and conditions for terminating the lease. Negotiating a fair lease agreement is critical to avoid unexpected costs or restrictions on how you can use the property.
9. Data protection and privacy agreements
Scaling often means handling more data, including customer, employee, and business information. As such, it’s vital to have GDPR-compliant privacy policies in place. Data protection agreements, both with customers and third-party vendors who handle data on your behalf, are essential to ensure you’re compliant with data protection laws and to safeguard sensitive information.
Final thoughts
Scaling your business is exciting, but it also requires careful legal planning. Ensuring you have the right contracts in place at each stage of growth can protect your business, reduce risks, and set you up for long-term success. At Jamieson Law, we work closely with scaling businesses to ensure their legal frameworks are solid and adaptable to growth. Get in touch with us today for expert advice on how to scale your business legally and confidently.
