As entrepreneurs and freelancers, we are always thrilled to get the next deal or project. Sometimes in our eagerness, we forget one of the business basics: a well-written contract. It would be nice if we lived in a world where everyone trusted each other, and all parties performed what they promised. However, experience in business tells us otherwise.
One of the most important elements of the contract between you and your client is an arbitration clause. Simply stated, the arbitration clause sets up a streamlined and cost effective method for resolving serious contract disputes between you and your client. Without an arbitration clause, the odds are you will be engaging an attorney to settle or litigate the matter in court (trial). This is a very expensive way to go.
As service entrepreneurs, most clients we deal with have more financial resources than we do. These resources can be deployed to hire highly qualified attorneys to litigate and intimidate the small service provider. It may seem unfair and unjust, but it is the reality of the litigious marketplace we find ourselves in. The arbitration clause levels the legal playing field for you.
At my former company, Treadstone Group, in 16 years we never were a party to a lawsuit. We came close a couple of times. Each time the arbitration clause saved us from expensive courtroom drama. I can recall one instance where a client’s attorney contacted us and threatened a lawsuit. The attorney had not done his homework. When we referred him to the arbitration clause in our contract, there was dead silence on the phone. He quickly realized there wasn’t any money to be made by him. We never heard from him again.
What follows is an example of an arbitration clause. ***You should use this as a starting point only. Laws differ from state to state. Consult an attorney to tweak the language****
“You and B2Bee agree that the substantive laws of the State of Ohio, without reference to its principles of conflicts of laws, shall be applied to govern, construe and enforce all of the rights and duties of the parties arising from or relating in any way to the subject matter of this Terms of Service. YOU AGREE TO SUBMIT ALL DISPUTES ARISING OUT OF OR RELATING TO THIS TERMS OF SERVICE TO FINAL BINDING ARBITRATION IN ACCORDANCE WITH THE THEN-EXISTING COMMERCIAL RULES OF THE AMERICAN ARBITRATION ASSOCIATION, BEFORE A SINGLE ARBITRATOR SELECTED FROM THE INTERNATIONAL ARM OF THE AMERICAN ARBITRATION ASSOCIATION. Except as otherwise required by law, any cause of action or claim you may have with respect to the Service must be commenced within one (1) year after the claim or cause of action arises or such claim or cause of action is barred. The parties expressly agree that the U.N. Convention on Contracts for the International Sale of Goods shall not apply to this Terms of Service.”
Has anyone had experience with clients where legal action was taken?
May 18th, 2010
In the game of business, our personal identity is our most valuable asset. More valuable than our computers, our car. Even more valuable than the cash in our bank account. As a service entrepreneur, your business’s identity and your personal identity are one in the same.
Like other productive assets, our identity allows us to generate revenue. It does so by providing the much needed differentiation in our services versus our competitors. Sure, flashy brochures and websites help to establish our brand and what we stand for. But the way the world, our customers, and our prospects assess our competence is largely determined by our personal identity.
So how do we define personal identity for the service entrepreneur? Your personal identity is NOT what you want it to be. It is NOT how you perceive yourself. It is NOT what you claim and display on your website. Your personal identity in the marketplace is the sum of what people “say” about you. These people are customers, vendors, colleagues, and competitors. Your identity is a mathematical equation. People speaking well of you in the marketplace adds to your positive identity. People trashing you, subtracts.
Back to differentiation. Reflect upon the last three or four new clients you landed. Why did they decide to do business with you? Was it price? Probably not. Was it your flashy brochure and website? Doubt it. Most likely it was your personal identity. Your reputation in the marketplace. Somebody they trust recommended you. Somebody was “speaking well” of you in the marketplace. Perhaps they learned about you from the web. From a blog, from Twitter, from LinkedIn. All of these sources can be the start of the formation of your identity in your customer’s mind. Your identity then becomes solidified by how you perform….your actions.
What are some common components of personal identity that all service entrepreneurs should seek to create?
* Trustworthiness
* Keeping promises
* Listening skills
* Genuine interest in a client’s business
* Expert in your specific domain (ex. graphic design, social media, B2B marketing)
What is your identity? What do you want it to be?
Your thoughts?
May 12th, 2010
Sell value. Sell scarcity. Sell uniqueness. Selling time is limiting. Finite. Earnings, wealth, and possibilities are capped. Selling time is emotionally draining. How many hours did I bill today? Only four? I need to bill twelve tomorrow to make up for it. Evolve your offer to fixed fee engagements.
Thoughts?
May 11th, 2010
Delivering on your promises as a service professional is key to gaining repeat business with clients. Over-delivering on your engagements is the key to growing your business through word of mouth referrals. People rarely tell their friends and colleagues about ordinary or sufficient customer experiences. Whereas, extraordinary experiences are often related to others.
One way to set yourself up to create an extraordinary experience is to begin with the end in mind. Plan on delivering something extra, something that the client was not expecting. Don’t quote it. Don’t talk about it. Just deliver it at the end.
Your thoughts?
April 12th, 2010
Jason Cohen, founder of Smart Bear, published an interesting post today on why creating something “disruptive” might not be the way to go. Instead of disruptive, he stresses the advantages of creating something that is “useful”.
This is exactly what the Bee is all about. Creating something useful. Useful and potentially indispensable to entrepreneurs and freelancers who need a straightforward approach to managing the financial aspects of their business. The Bee is a rejection of all things complex and sophisticated where business finance is concerned.
In the late 19th and very early 20th centuries, everything was still far more formal than today. Honor, both personal and professional, was paramount. Respect and decency in discourse was expected, and when someone made a commitment to do something, man they made a COMMITMENT. As I followed the story of Count Dracula, his spread from the Baltics into England and his subsequent demise, I could not help but be impressed by the small but dedicated group of friends led by the famous 
I’m new here at The Bee, so I’d like to start by saying hello. I am the new Chief Buzzologist, which means I am responsible for making as many people aware of our fantastic product as possible so that they will sign up to use it and reap the amazing rewards. But what’s also new is that for the first time in my entire career, I am providing my services in a freelance (1099) capacity.