Negotiating A Contract With A Client? Here Are 9 Best Practices


Negotiating contracts and terms with clients is a critical aspect of any business engagement. Whether you’re a freelancer, a small business owner, or work for a large corporation, understanding and implementing effective negotiation strategies is crucial for achieving mutually beneficial outcomes.

To employ the best practices in contract negotiation—as well as safeguard your interests, foster productive client relationships, and ensure the smooth execution of projects—consider the following advice from members of the Young Entrepreneur Council.

When negotiating contracts and terms with a client, what’s one best practice to keep in mind? Why?

1. Maintain open communication

One best practice to keep in mind when negotiating contracts and terms with a client is to maintain open communication throughout the negotiation process. Be transparent about expectations, ask questions when necessary, and be willing to compromise when appropriate. By working together to find mutually beneficial solutions, both parties can feel satisfied with the final outcome. —Eddie Lou, CodaPet

2. Discuss boundaries upfront

Establish preset terms and guidelines. Let the other party know upfront what your dos and don’ts are, along with the rationale for each item. This sets the tone for the rest of the conversation since you are upfront with your non-negotiables. It’s not about making concessions at later stages, but being very transparent about what you need at the beginning. Then, you can start actual negotiations. —Firas Kittaneh, Amerisleep Mattress

3. Prepare to compromise

One of the most important things to remember is to communicate clearly and be prepared to compromise when necessary. This will ensure that both parties understand the terms of the agreement and are comfortable with its outcome. Furthermore, it will create an atmosphere of trust and respect, making it easier for both parties to reach an amicable agreement. —Kristin Kimberly Marquet, Marquet Media, LLC

4. Think about scalability

Keep scalability in mind. For example, ask yourself: Will the terms of the contract accommodate rapid growth? Is it written to allow for contract modifications if the scope expands? When trying to move a deal forward, don’t forget to think about the big picture. —Jack Perkins, CFO Hub

5. Stay mindful of your resources

When negotiating contracts and terms with a client, one thing to keep in mind is that you shouldn’t overpromise. It’s important that you carefully assess your current resources, evaluate them against the client’s requirements, and communicate clearly. This will make it possible for the parties to set clear expectations from the get-go and help them avoid unforeseen conflicts in the future. —Stephanie Wells, Formidable Forms

6. Approach negotiation with goodwill

What I’ve found helpful is to approach the negotiation as a problem-solving exercise, rather than a combative discussion. I don’t want to “win” the negotiation and get my terms only. Rather, I try to find common ground with the other party and find solutions that work for everyone involved. This leads to better outcomes and good relationships with clients in the long run. —Syed Balkhi, WPBeginner

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7. Look for the client’s top priorities

Try to put yourself in the client’s shoes and understand what’s most important to them. They won’t always tell you their top priorities or red lines upfront, so it’s helpful to ask. This can help break the ice and speed up negotiations as well. If you’d rather not discuss the client’s motivations for any reason, use past experience to make an educated guess about their priorities. —Andrew Schrage, Money Crashers Personal Finance

8. Strive for clarity and specificity

One essential best practice when negotiating contracts is to ensure clarity and specificity in the terms and conditions. Clearly define the scope of work, deliverables, timelines, payment terms, and any contingencies. This helps to mitigate potential misunderstandings or disputes in the future. —Jared Weitz, United Capital Source Inc.

9. Seek out an advisor if needed

Recognize when to ask for help and seek the advice of an advisor. Negotiations can be challenging and stressful, especially when significant stakes are involved. An advisor brings specialized expertise and a fresh perspective to the negotiation table. They can review the agreement objectively, navigate complexities, and help you negotiate fair and favorable terms. —Ismael Wrixen, FE International

About the Author

Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most successful young entrepreneurs.

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