As lawyers we pride ourselves on reading the fine print for our clients.  We perform due diligence and ensure contracts are free from unconscionable or one-sided provisions.  That said, we recognize that most small businesses enter into contracts every day with outside vendors for myriad services, without the benefit of legal counsel.  Oftentimes, however, these small business owners do not know these vendors personally, but instead identify vendors in the proverbial phonebook, via crowdsourcing on a social media platform or possibly through a network referral.  This is where things can get tricky for the vulnerable and unsuspecting small-business owner.   Many times the vendor contract for services is replete with provisions that are unfavorable to the small business owners.   We typically hear from these small business owners only after they have fully executed these one-sided contracts, hoping that a skilled attorney can help them navigate their way out from under an unconscionable and unfair contract.  While we have successfully secured relief for our small-business clients faced with this situation, we also offer the following solutions to our clients to avoid these pitfalls with outside vendors before the contract is fully executed:

  1. Do your research.  Especially in situations where the vendor will be responsible for your website content or marketing services, get plenty of referrals.  Do not exclusively rely on a small business network for referrals unless an identifiable individual can vouch for the vendor’s work product.  These referral networks can be a lifeline for small-business and their mission is laudable; however, the goal is to generate as many mutual referrals as possible for its members.  Get names of former clients and do your homework before signing on the dotted line.
  2. Read that fine print.  For example, we learned that in standard contracts for website platform and design services, if the relationship with that vendor ends, they take their website and the content they created with them.  In other words, if you retain a vendor to create a logo or design for your business, make sure the contract allows for you to keep that logo or design after the vendor-client relationship ends.  In many standard contracts, the vendor is entitled to retain much of your website content or marketing materials, forcing you to start from scratch with another vendor.  The overall design, logo and branding of your website contractually remain the intellectual property of the vendor, unless you negotiate otherwise.  Which means you oftentimes will be left with no website design and logo for that period of time when you are between vendors.
  3. Beware of services that are marketed in a vague way.  Oftentimes vendors trumpet their “brand management” abilities or promise to “increase your reach in the market.”  Branding and marketing are critically important for small businesses, and reliance on those vendors is commonplace.  That said, make sure you evaluate the background and experience of the vendor offering these services.  We have learned that individuals looking to change careers sometimes market themselves as branding experts, but their background is not in that particular field.  While a career change does not necessarily mean the vendor is ill-suited to provide quality services, if the vendor’s past experience does not align with the promises she is making, you may wish to keep looking.


DISCLAIMER: The information on this page is provided for informational purposes only and should not be construed as legal advice or acted on as such. The content on this page may not reflect current legal developments or address your situation. It does not create an attorney-client relationship or provide guarantees or endorsement of behavior and is not a substitute for obtaining legal advice from an attorney on a particular legal matter.