Types of Business Contracts

When it comes to business, there are several different contracts, which deal with various areas of business. It is imperative to know the importance and scope of each business contract to stay ahead of legislation. Contracts are comprehensively into three categories:

  • General business contracts

  • Sales-related contracts

  • Employment contracts.

General Business Contracts

The general business contracts encompass the activities and the basic trade components that dictate the rules and regulations of a business. Contract lifecycle management software is the best application to manage general business contracts effectively. The different types of general business contracts include:

  • Property Lease

A property lease is a legally binding document that is created when leasing or renting a property for business. Since rent and lease for business purposes is different from residential purposes, it is essential to create and execute a contract between the parties.

  • Equipment Lease

At times, a business will require to lease out equipment, which will be used for furthering the business. Such renting or leasing of equipment requires a contract in order to establish authenticity.

  • Partnership Agreement

The most basic and important of agreements is the partnership agreement. The terms of the agreement provide a detailed description, roles and benefits of the partners.

  • Non-Disclosure Agreement

The non-disclosure agreement enables the company to conduct business without their trade secrets being spilled. The non-disclosure agreement ensures that the confidentiality of the business is not jeopardized.

Sales Contracts

The sales contracts ensure that the business between parties happens seamlessly. Contract management software for sales is the ideal choice to create and monitor sales contracts. The different types of sales contracts include:

  • Purchase Order

When it comes to business, the purchase order plays a crucial role. When a client orders products or services, the purchase order is created, which signifies the obligation of the seller to deliver the items and the buyer to pay for it.

  • Security Agreement

In the course of conducting business, getting loans and advances to expand business becomes a necessity. The security agreement is created to procure a loan against an asset, for the purpose of business.

Employment Contract

When employees join a company, a contract is created to establish the roles and activities to be performed by them and the compensation offered by the company. The contract will contain important information such as rules and regulations, terms of employment, benefits, grounds for termination, etc. Once the contract is signed, the candidate officially becomes an employee.

Business contracts are usually created and stored in the enterprise contract management software, and a team of experts oversee the management of contracts to help the company. DocuCollab is one of the leading contract management software providers, with a myriad of benefits. Click here to know more.

Location: United States

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