A business colleague recently pointed out that some companies, especially new ones, often offer their services without a contract to eliminate any barriers to getting clients. We've seen this trend in our industry as well, but we always engage in a contract process with our clients and this is why.


1. Contracts provide an opportunity for you and a client to get to know each other.  

The contracting process is a wonderful opportunity to get to know what's important to your clients and let them know what's important to you The process also helps us educate our clients, many of whom don't deal with ticketing day in and day out. Going through the contract allows us to tell them about what they should be considering as a whole for their events. No matter what your business is, you can benefit from the process.


2. Commitment builds stronger businesses.  

At its essence, a contract is a commitment. It's saying, I want to do business with you for a certain period of time. These types of commitments provide stability and a foundation for growing a business. It allows you to plan for growth. You can entertain deeper partnerships and engage in long-term planning with your partners. You can build on experience to make you both stronger year after year.


3. Investors and funders like to see commitment on your books.

If your business is dependent on funding, those investors are going to want to see solid revenue and projections based on commitments, not guesswork. If you have no commitments to support your middle- to long-term stability, you run the risk of weakening yourself in the eyes of critical funding streams.  


4. Contracts build confidence in your business.

Startups already struggle from an inherent lack of credibility and confidence in the market because they don't have a track record. Not being willing to make a commitment to a client in the form of formal agreement can exacerbate this problem. When you're willing to put your name on the dotted line, you're saying, "I'm going to be here for the long run; you can count on me" instead of, "I might mess up. but don't worry. You don't have to commit."  


5. Things can go wrong.

If you're in business long enough, there will be a case where you need to dig out a contract for clarity or to protect your interests. If you have no contract, then you have no basis to start a conversation about a difficult topic or clarify your position should there be a dispute. 


Kathryn Dickel has been a part of growing creative communities for 14 years through her business MIDWESTIX  in Des Moines. She has presented numerous workshops and panels on entrepreneurial life and has worked with dozens of startup clients as a private consultant. She can be reached at