There are many types of contracts but we will only briefly touch on sales contract here.
Whenever you sell something to somebody, a relationship between buyer and seller arises. In many cases, it makes sense to sign a contract that defines the rules of the game governing the transaction, in particular:
- product, scope
- price and payment terms
- under which law the contract is signed
- who are the two parties signing the contract.
Rather than negatiate contracts individually, companies usually have standard ‘Terms of business’, also called ‘T&Cs’ (terms and conditions). In case one of the parties (typically the buyer) refuse the T&Cs put forward by the other (typically the seller), it can suggest to use its own T&Cs; or put forward a detailed contract, ‘made-to-measure’ and to be negotiated between the parties.