Upstream contracting: why involve legal from the start

Contracting is a key phase in the implementation of any project involving external partners, whether your company acts as a customer, service provider, or supplier.

Too many projects are conducted with a focus on operational and commercial aspects alone. The contractual phase is frequently postponed until the end of negotiations, when all other terms have already been agreed. In that situation, legal becomes a blocking point that delays the project — and may even end it.

I regularly see that legal’s reputation as an obstacle is unfounded. It stems from a difference in language between our respective roles. In reality, legal input from the outset provides a powerful lever for protecting your interests and saves significant time in the project’s setup.

What legal brings to the table

The purpose of contracting is to set out mutual obligations and provide remedies for any situation that could compromise the project’s execution.

Integrating contractual negotiation into the broader commercial negotiation enables you to assert your constraints more effectively and, particularly as a young company, to achieve a contractual balance that would be far more difficult to obtain if contracting is left to the last stage — time works against the party with less economic leverage.

As a customer, it is essential to include mechanisms addressing delays (penalties, interest) or exit for non-performance. For further detail, see my article on negotiating a SaaS agreement.

As a vendor or service provider, it is in your interest to ensure that the contract terms do not impede the performance of your obligations (unrealistic deadlines, excessive client interference) and that payment terms align with your cash flow requirements. On the provisions to include, see the article on essential clauses in a software development contract.

Introducing legal input early into your commercial and operational processes saves time in the long run and signals a professional, structured approach to your partners. For an overview, see the SaaS contracting guide.

Conclusion

Involving legal from the start prevents it from becoming a bottleneck at the end. A contract negotiated alongside commercial discussions protects your interests without slowing the project. If you need to structure your project contracting, book a call.

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