Yes — you ought to, for your own benefit. Anytime you enter into a business relationship, especially a workspace agreement with someone, you ought to have a Contract or License in writing that specifies your do’s and don’ts, as well as that of the Workspace provider. It’s just good business practice and part of your due diligence to do so. You don’t want to enter into what you thought was an easy, friendly, loosey-goosey arrangement, only to find that what you were promised wasn’t provided, or that you did something that you weren’t aware was unacceptable or was billable.
The basic rule of thumb is that if you pay for something, even if it’s a one-shot deal you should get a receipt. If there are terms or specific provisions then you must request a signable/counter-signable contract, so that you are entirely clear of your obligations, and so is the workspace provider. The workspace universe is littered with all kinds of horror stories of no-contract with no recourse incidences. Here are just a few examples to be wary of:
- “Renters” who didn’t sign a contract for a workspace, only to find that the workspace provider was in a default or foreclosure situation;
- Operators who had a lease expiring and was gathering rents and deposits with the intention to skip town;
- Operators who had no legal right, according to their master-lease, to sublet or offer offices or other workspaces;
- The sudden death and illness of the person you entered into what you thought was a solid, verbal agreement, but whose passing left you without proof or recourse;.
- Opportunistic workspace operators who suddenly saw a dramatically better deal come down the pike that involved your space, and pulls the rug out from under you, then you’re left out on the curb with your business, and with very little warning.
Then there are the members or renters who thought they were entitled to some private meeting room usage; free coffee, copies, tech support; or some other entitlement, only to find an unexpected expense appearing on a monthly invoice, with no contract in existence to bare out if the charge is appropriate. Or how about an injury, fire or robbery, or other emergency, where there’s no contractual evidence to go after the workspace provider or their insurance company.
All these are far more common than most realize, and most of the time they occur, it’s usually the renter/member getting the short end of the stick. If you think that you have the advantage and upper hand by being able to leave when it suits you if there is no contract in place, I suggest you examine all the pros and cons. As you do, ask yourself whether the sum of any perceived advantage of a unenforceable verbal agreement, is really worth the risk and upheaval of allowing a workspace provider to be able to undermine your business, at which time you could suddenly lose your space.
I recommend that you seek, and only deal with only the best, reputable Operators, but that you first adopt the standard and mission that you are going to be a solid entrepreneur yourself, governed by legally binding, above-board contracts that sort out differences smoothly before they occur, and that speak well of your business acumen.
The Winning Workspaces Q&A is a weekly column that provides clarity and insight into the vast array of office and workplace alternatives that are available today which cater to a variety of lifestyle-driven needs of the business professional.
Ray Lindenberg is a 20-year workspace industry leader, historian and consultant. He is Director of Branding and Marketing at Select Office Suites and can be reached at ray@winningworkspaces.com or at (888) 692-7353, ext. 2.
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This is wise advice. I’ve never had trouble with a Business Center in this regard; I’ve been lucky to deal only with reputable firms. But I’ll never forget the time when I was 21 and bought a car from a “friend” with a handwritten agreement — only to learn, after I’d bought it, that the car was a mess. Robert Frost said “Good fences make good neighbors.” And good contracts make good friends.
You got that right Bill. Some people think contracts are inhibiting. On the contrary, they provide clarity, benchmarks and guidelines so that one can forge ahead with more freedom, confident that if and when they hit a bump in the business road, a thorough and fair document can be referred to that spells out the right way forward.
Prudent businesspeople don’t shun contracts — they embrace them. A good, fair and clearly expressed contract is the biggest friend a business could ever have, because life has a way of putting stumbling blocks in our paths. A good contract that is fair to all parties reduces and sometimes eliminates any stressful byproducts from those unexpected hurdles, so that everyone can move ahead in better shape.