6 KEY Contract Negotiation Skills | Redline Your Own Contracts (Advocate For Yourself)

Hi, I'm attorney Brittany Ratelle, and I am a lawyer for online business owners just like you. And I've helped hundreds of entrepreneurs get legally legit so that they can show up with more confidence in their business. I've helped creators, creatives, e-commerce owners, Etsy shops, influencers, bloggers, and all kinds of cool entrepreneurs doing amazing things online. And I'm excited to help you, an entrepreneur, show up with more confidence in your business and figure out all the legal stuff so that you can move forward and create more value, create more awesome stuff in the world, and help the people who you're meant to help. This video is part of a foundational series I've created on how to wrangle the legal stuff and the foundations in your business, and especially how to uplevel your side hustle or your hobby or jobby, as I sometimes call it, into a real business. And what does that look like? And what are the steps you need to be doing if you are in the driver's seat, especially if you have not consulted or worked with a lawyer or a legal professional to help you. Make sure that you check out the other videos in this series as I go over such things like how to decide which entity structure would be good for you. That's the whole LLC versus sole proprietorship versus S corp alphabet debate, as well as how to write a contract without a lawyer and the 5 red flags that might be showing the world that your business looks more like a hobby than an actual business that they wanna pay and work for at a value and rate that makes sense for you. So let's get into our beef today in terms of how to negotiate a contract. What are the actual steps? To redline a contract. If you've ever been confused by that term or been sent over a contract and had that nagging feeling that you're supposed to be checking for something and reviewing it, and maybe you have access to an attorney, maybe you don't, maybe you're on a tough timeline or you're not sure who to call, but you would like to have some resources, some skills, something in that toolbox at your disposal to help you negotiate and redline your own agreements and make sure you understand as best as you can what you're signing and what you're signing your business up for. So let's get into it. Tip number 1, overarching theme here is we need to remember that negotiating a contract is a dance. There's back and forth. There's give and take. Imagine Yul Brynner with this, you know, handout of like, shall we dance? Okay. And they're going to have that beautiful waltz and a big ball gown. If that fits with your fantasy, great. It does for mine, but you do you. But that's what we want a negotiation to be and to understand that there's no shame in negotiation. There's nothing wrong with you. You're not being greedy. You're not being manipulative or difficult. And you're also not necessarily thinking the other side either. It's just a reasonable, prudent step to take as a business owner to make sure that you're setting up clear expectations and that this document, this agreement, whether it's electronic or on paper, it's probably gonna be electronic. It just has a really clear understanding of the relationship and how you and other multiple people are gonna be working together. It's recognizing that business and promises can be complex, so of We're just gonna write it down because our brains are not good at remembering things. And that's all a contract needs to be and all it really should be. And so let's get into how we make it the best contract possible for you. Step number 1, even if someone sends it to you in the signature portal, meaning they send it already in something like HelloSign, Adobe Sign, PandaDox, whatever, and really the only options are left for you to sign, please do not feel the pressure to sign it the way it is. The goose is not cooked. The deal is not done and there is no problem and no drama for you to raise your hand, slow things down just a second and say, hey, can I have an editable version of this document? That's a mini step there. If they say no, or they're taking too long, or they're like, oh, I don't know where we have it or whatnot. Okay. You have other options. You can say, hey, I'd like to make some changes to this agreement. And you could put it right in an email. I like email over phone call because it's going to be easier to pinpoint back in the document. Make sure to look at the document. If there are numbered paragraphs, use those. If there's not, go to the title. So for example, if one section says scope of work or intellectual property, then say intellectual property, and then write your new sentence or your new paragraph of how you would like it changed. Now you can use red text. The term redline comes from people literally used to use red ink on contracts back in the olden days when we didn't have document processing. That term has lingered, but you don't actually have to use red text. You can use whatever font, but it's nice to use something different so people understand what changes you're making. I've used bold font, I've used different color, I've used italicized, any way that makes it clear, hey, I want to edit this part and this line or this word in this part of the contract. And the faster you can help the other person see that, the better. You're not trying to do any shady games here. We're all on the same team. The team that we want is a finished, completed, fair contract. So let's work together to make it easier for the other side to know exactly in a heartbeat what you're talking about, and maybe their legal team as well. If that's not going to work for you and you still want a chance to actually edit the document yourself, you have legal counsel, for example, I do this for a lot of my clients. They get a document, they know they're gonna send it to me and I'm gonna review it. So it needs to be in a version that I can review it, and I prefer to redline and edit on the agreement itself, especially if we're gonna have multiple rounds of contract negotiations, which sometimes we do depending on the nature of the contract and how big of a deal it is. If that's something that you're gonna wanna do and it's in a PDF and someone sends you a PDF that's ready to sign, what you're gonna wanna do is you can again ask for the editable version or take it upon yourself, go online and search for an online converting tool. Like PDF to Word converting. They kind of look like one of those sketchy websites that have ads that will come up, but they're fine. They're just trying to make money. They're just trying to live their life. And that's going to take us to our next step, which is tip number 2, have good contract negotiation manners. What I mean by this, it goes back to our overarching idea. What's our goal here? We want a fairly negotiated contract. And because that, we're not gonna make it hard for the other side to see what we're changing, cuz we're not afraid of it. We're not ashamed of it. We're not gonna like sneak around the contract and slip something in. No, that's not how we're gonna show up in our business, and that's not how you want someone else to show up in your business, right? So good contract negotiation manners, good contract manners and redlining manners say that you make it clear we're dealing with a new contract. So you should save that new contract with the party names if that hasn't already been done. Make it easy for you and the other side to make sure we're talking about the right contract and we're saving it so we don't have any confusion. So check the file name at the top. If your names aren't on there, the party names that should be in the first paragraph, add them to it. Also add the current date and/or the version number. For me, I like to add the date and I either do it with dashes or dots to make sure I'm not messing up any file name. If you do slashes like this, a lot of times the software won't allow you to save like that because they think you're messing with the file extension. So do periods or do dashes. Do the current date that you're working on it and typing on it. That way someone could look at it and say, oh, okay, there was a date from a week ago or a day ago, but we should be working on the most recent copy. Makes sense? And then sometimes there'll be a version number because if it's a contract you received from another party, they could have 100 different versions, probably not 100, but they could have several different versions of this contract depending on what kind of deal. And it all stems from maybe like a mothership contract. So they might need to have their version number in there and/or a version number could also show how many times it's been back and forth. If that's already been set up and you are the first one to touch it and they send it to you, add version 1 or V1 on the contract. It'll make you look legit and they'll be like, oh, They know what they're doing. They must have a lawyer. Maybe she does and maybe she doesn't. All right, Maybelline, they don't need to know how the sausage is made. Okay. You just look out for you. And then finish up our good manners. If you want to do true redlining, I suggest turning on track changes. If you're using Microsoft Word, this is fairly easy. Go up to the top panel where it's in blue and go to review and then toggle on press track changes. And that means everything you now write on this contract will come up And will be tracked, track changes. Okay. Pretty straightforward. If you do not have Microsoft Word, because you're a modern millennial, zennial, and you don't play in Microsoft Word, pun, that's okay. We still love you. Business could still be great, but you can do this in Google Docs. You're just going to want to turn it into suggesting mode. And so go again up to the right into the column. You'll see there's an option there, turn it into suggestion mode instead of editing directly on the document and it'll turn it into green type. And then you can also add comments. That's another way you can do that instead of editing directly on the document is you can click and add comments to where you want things changed. I usually like those in addition, if there's other questions or supporting, is this going to be okay? Or we need to check on this. Comments like that instead of the actual text, I prefer to do it on the document itself because then it's really easy for someone to accept it or reject that change. The last tip is that if you can't figure out any of this, and this is stressing you out and it's like rising up inside of you and you're like, Brittany, this all sounds good and cute, but I am never going to figure out all this. That's okay too. Let's give you another option. You can just put, remember, in your email to the other side, or hop on a phone call, but I prefer email. Put it in writing. Say, hey, super excited about this project, about this deal, about this moving forward, working with you. However, I need to see some changes here. And just write out what you want changed and put it on the other side. That's always an option, right? You to just ask for what you want, just advocate for yourself, and then put it on the other side. Make them figure it out. Make them go call up legal or whoever they need to, to figure out what the text needs to look like. Not an ideal situation, cuz I like to control the information, cuz then you're gonna have to come back and review the text and you're gonna draw out that timeline. But better than nothing, right? Better than you burying your feelings and being like, I'll just grin and bear it even though I don't like the language and I'm not sure it says what I needed to say. You don't have to take that. All right. That was a big thick one, but we covered a lot there. Tip number 3, you need to be your own best advocate. You have limited resources. We live in a finite mortal world. You have limited time, you have limited energy, you have limited capacity to do your best work, to be in your zone of genius. There's everything right with you being your own best advocate for yourself and your business and doing what you need to watch your own back. And no one else is gonna do as good a job as you, except for like maybe your attorney, because that's their job is to be your advocate. You shouldn't feel any shame or judgment, or if you're dealing with some kind of imposter syndrome or there's stuff coming up for you when it's time to negotiate a contract, be curious about that. Listen to that. See what maybe is underlying that. Have some questions about that, but understand that maybe other things that you need to process and resolve, and not necessarily a true fact. And certainly don't ever let any eye rolls or little comments or snippiness or passive aggressiveness from the other side make you feel less than, or make you feel like a diva or greedy or manipulative or cold or whatever other word you would put on it for negotiating a contract. You need to look out for yourself so that you can keep showing up and serving people the way you want to. Because the truth is, if you can't be an advocate for that, for your space and your time and your mental health and your capacities and your resources, then you're gonna burn out and you're not gonna be able to show up and serve consistently the way you want to and the way you like to serve your audience and your customers and your clients. So you gotta look out for you. You got your back. You can do it. Tip number 4, negotiation principles in general. There's a couple books I recommend. I'll put 'em in the notes, but Getting to Yes is a great book. Never Split the Difference. Those are hallmark classic negotiation books that really anyone should read if you wanna increase your negotiation skills. But here's, here's the short version. It's not personal, it's just business. And the more that you can take out the emotion out of the equation and look and be approached with curiosity, what's going on, the better you're gonna get to a collaborative solution that's gonna be both. And make sure you understand what is motivating the other party. If they're having a hard line about something and you have a hard line and you're not moving past that, ask more questions. Understand why are they taking that stance? What is it they're worried about? Do we need more information into the situation so that we can both feel better about the unknown? Because that's what contracts are trying to control, are unknowns. And we're saying, who is better served to take on that risk? Is it me? Is it you? Should we both share that risk? How should we take on that risk? That's what a contract, and really most of law, is trying to figure out. Sometimes we just need more information in there, and then we feel better about portioning out the risk. Remember, to generate options, you're trying to create and problem-solve together. You're on the same team because you want a resolution. You want to sign a contract, a fair contract that you both agree to. Make sure Or to try to couch things in terms of facts and not feelings. Your feelings are valid, not trying to discount those, but it's easier in here when you're trying to collaborate and work together. If we can point to things that can be substantial and codified and verified outside of your own psyche. We're looking for fairness and we're looking for third-party data. Do your research. So if you have a price point and they're really pushing back and they, and they don't wanna pay for that, it's so much easier for you to have data and be like, actually, industry average says this is a reasonable rate, or this is this is what I have charged for other clients for similar work, or I've done my research on such and such other database or resource. And, you know, bring transparency to situations. A lot harder to argue against that when it's like, those are the facts. Now you can argue, if you don't have the budget, then we need to adjust the scope of work. But the facts are the facts that what you're asking for, this is what the value is. If you get stuck, ask more questions, be open, try to keep the drama and any anger out of it, passive aggressiveness, keep things civil. Keep things moving along. So those are big picture negotiation principles. Number 5, let's talk about the hot legal terms that you need to be looking for in an agreement. We talked and dug into more of these in my previous video. So if you haven't watched that yet, that's one you definitely wanna go back to in terms of how do you draft a contract without a lawyer? What are you looking for? How should you go about this process? These are things if you are reading and reviewing a contract, you should be watching out for these words. For example, you can use Ctrl+F to search for these in a document, especially if you get handed a really thick document, maybe it's like a licensing agreement. Those are famous for being very long. Use Ctrl+F and find some of these terms and you at least find out the general area where they are and then make sure you're reading everything, but then look above and below because they tend to be grouped together. Correct party names in the header. You should be named correctly, especially your business entity. Look for payment. How much? By when? Late fees, the method of payment. You, you should know that. Exclusivity. You need to know whether it's exclusive or not. Intellectual property. This is a big one, especially if your business centers around intellectual property, if that is your main product, if that is your main commodity, if that is your main brand of what you sell, this is critical information that you need to make sure you're understanding what you're agreeing to in every single contract that you sign. You need to be looking for terms beyond intellectual property license, usage, in perpetuity, name, image, and likeness, or NIL for short, copyright, work for hire, assign, reversion of rights. All those language can be used to describe intellectual property. Do we wish there was just one way to describe things and make it easier? We do. Take it up with the lawyers. I'm sorry. I don't make the rules. I live in the world just like you. This is where we're at. Okay. Next is scope of work. You want a tight scope of work. It should be clear and precise, not vague and ambiguous. Are there change orders? Are there rounds of revision? Approval process. Who's approving? How many people get to approve? How many times? Is there a deadline? If we don't get your approval, can we move forward? And then are there other documents referenced in this agreement? Sometimes I see, especially in influencer contracts, they'll reference brand guidelines or social media media policy, and you are agreeing to abide by those. If you're agreeing, you gotta make sure that you've seen them and that you could agree to them. And there's not stuff in there that you're like, uh, I'm never going to be able to do that, or I'm not okay with that. Or frankly, I just don't like signing things and agreeing to things without knowing what I'm agreeing to. So make sure you're clear because depending on how those documents, they could be integrated and could be considered part of the contract. Schedules A, B, C, et cetera, scope of work, all those are really common other documents. That can, like I said, be part of the real contract. So you need to have access to those before you sign. Before you sign. Those are all basic legal terms. We could go into more. We will go into more. Make sure you're liking and subscribing to this channel so that you can get more info. My last point here and last tip, tip number 6, is make sure that there's a meeting of the minds of the contract. Meaning you sign it and the other signs it. You're not in a Bridgerton novel here, unfortunately. You don't have to worry about paper and ink signatures. You know, you wear a Regency core dress if you want to. I myself I'm also tempted to do that, but an e-signature is fine. If anyone tries to give you grief and is like, you need to print this out and sign with the blue ink and scan it back, call them on their bluff. That's no good anymore. That no, no work. Okay. My Big Fat Greek Wedding. E-signatures are fine. They are enforceable in all 50 states. Use HelloSign, Adobe Sign, PandaDoc, Dubsado, HoneyBook, 17hats, whatever, as long as you can authenticate the person. That is signing it, usually via their email and a login that they do, it's fine. It's legit. You can take that to Judge Judy and beyond. Okay. It is enforceable. Now, if you are going to be the one setting up signing portal and setting off for signatures, you're going to need someone's full name of who's signing it and also their email address. If you haven't gotten to that point in negotiations and you're ready for signatures, ask for who's going to be signing it. It may be different than the person that you've been talking to, because it could be a CEO or a manager or someone higher up with signing authority that can bind the business and should speak for the business and enter into a contract on behalf of the business. This is a lot that I threw at you, but thanks so much for being here, for digging in. I hope these tips are helpful for you. Again, if you want more tips on how to move forward with confidence in your business, how to make sure you understand this legal stuff so you can show up with confidence, make more money, have less drama, sleep better at night, and make sure you can show up the way you want to and serve people the way you want to, make sure you are liked and subscribed to this channel. I'm Brittany Ratelle, and connect with me on Instagram. I'd love to hear. What you're learning and digging about this information, and what questions you have next that I can answer for you. Thanks so much for being here.