The Contract Risks That Catch Growing Agencies Off Guard

Contracts offer security and set out the terms by which both parties must abide. When entering into a deal, though, there are some areas of the contract that – if not scrutinised properly – can lead to costly repercussions further down the line. 

At Glaisyers ETL, our team has years of experience in contract law and can expertly pinpoint areas within your contracts that could trip you up.

Common Areas of Risk in Contracts  

When your business or agency is small, things that worked within contracts may not provide adequate depth further down the line, and often, vagueness or incompleteness in contracts can lead to costly legal battles once operations scale up.  

Below, we will detail five key areas of early contracts that can often lead to risk: 

1. 1. Poorly defined deliverables: Early contracts often don’t have specific wording; they may say things such as ‘provide marketing services’ or ‘ongoing digital support’. This can lead to agencies doing extra unpaid work as a business’s needs increase.
   2. Intellectual property (IP) ownership: Contracts may state that clients own everything immediately, even before payment, or, in some cases, may not define ownership of tools, templates, or frameworks, which can lead agencies to give away valuable processes or creative assets.
   3. Termination clauses: Clients can terminate immediately without notice if they are not adequately set up, leaving agencies stuck mid-project without payment protection.
   4. Data protection and compliance: As agencies grow, they take on more customer data and analytics. If a contract doesn’t clarify the roles of data controller and processor, it can lead to data being misused, which opens them up to potential legal issues.
   5. Subcontractors and freelancers: Scaling agencies often rely heavily on freelancers; if client contracts don’t allow subcontracting, bringing in a freelancer could be a breach of those contracts. It could also mean that a freelancer may end up owning the IP of the things they create; therefore, this must be clearly set out in the contract. 

For in-depth advice on the contracts your business or agency has, and consultation on the risks they present, contact our expert team at Glaisyers ETL today.

The Commercial Consequences of Outdated Agreements 

If contracts contain areas of ambiguity or simply miss some details early on, then the knock-on effects can be disastrous for your business later.

For example, issues regarding who owns IP can end up in court, meaning time and money is taken away from your company and injected into something that was at one stage completely avoidable.  

How Early Review Supports Growth 

At Glaisyers ETL, our expert team can provide you with a thorough audit of your company’s contracts, ensuring that no stone is left unturned. The benefit of doing this, even at an early stage in your business’s life, is that it means you are protected from legal battles further down the line, meaning you could end up saving yourself vast sums, which can then be spent on growing your business.

For a contract review and to see if yours are up to date with how your business operates, get in touch with our team.