Put it in writing: simple agreements
Write down the deal with a partner, supplier or big customer, before a disagreement does it for you.
6 min read
Most small business deals in India are made on a handshake and a phone call. That works — until the supplier delivers late, the partner wants to leave, or the big customer says the price was always meant to include delivery. Then each side remembers a different deal, and there is nothing to settle it with.
A written agreement is not a sign that you do not trust someone. It is a record of what you both meant, made while you still agree.
Which deals to put in writing
You do not need a contract for every sale at the counter. You do need one for anything where a disagreement would cost you real money or a relationship:
- A partner — anyone who shares the ownership or the profit
- A regular supplier — especially if you buy on credit or depend on them
- A big customer — anyone who orders on credit, or whose order needs you to buy material first
- A landlord — covered in the rent agreement lesson
- Anyone lending you money — covered in the lesson on family and friends money
What a simple agreement says
It does not need legal language. It needs to answer the questions people argue about later:
| Question | Write down |
|---|---|
| Who | The full names of both sides, and the business names |
| What | Exactly what is being supplied or done, with quantities and quality |
| How much | The price, and whether it includes GST, delivery and installation |
| When | Delivery dates, start and finish dates |
| How payment works | Advance, on delivery, or credit — and the due date |
| What if it goes wrong | Late delivery, defective goods, missed payment |
| How it ends | Notice to end the arrangement, and what happens to stock or money |
If a full agreement feels like too much, send a WhatsApp message or an email after the conversation: "As discussed — 200 pieces at ₹X each including delivery, by the 15th, payment 30 days after delivery. Please confirm." A reply saying "confirmed" is far better than nothing.
Partners need it most
A partnership with no written deed is the deal most likely to end badly, because it lasts longest and involves the most money. Before you start, agree and write down:
- what each partner puts in, in money and in work
- how profits — and losses — are shared
- who decides what, day to day and for big decisions
- what happens if one partner wants to leave, falls ill or dies
- how the business is valued if one buys the other out
The structure lesson covers the deed for a partnership firm, and the LLP or shareholders' agreement for the other structures.
Do not copy an agreement from the internet and sign it unread. A template written for someone else's deal may include terms you never agreed to, or leave out the one you care about. Use a template as a checklist, then write your own deal into it.
Keep the paper trail
An agreement is only as good as your ability to show what actually happened under it:
- Keep signed copies on both sides, and a scan on your phone.
- Confirm changes in writing too — a new price, a changed date.
- Keep delivery challans, purchase orders and payment receipts with the agreement they belong to.
When to get a lawyer
For a partnership, a large supply contract, anything involving property, or any deal where losing would hurt the business badly, pay a lawyer or CA to draft or read it. The fee is small next to the dispute it prevents. Stamp duty and registration rules for agreements differ by state and by type of document, so ask them about that too.
Describe the deal you are about to make to the tool below, and it will help you list what your agreement should cover before you meet a lawyer.