Does your company sell high-value or complex products? Or do you sell products that come with a related service, such as free installation?

Complex products can provide a lot of value for companies and customers alike. However, they also sometimes cause conflicts between buyer and seller. There’s always the chance there will be a miscommunication and something will go wrong. 

For example, imagine you’re selling a product such as real estate, electronics, or commodities in bulk. You complete the sale, and everything seems fine at first. But soon, the buyer comes back with a complaint—they claim that there’s a problem with the product you sold them, and that they didn’t know about this beforehand. You’re sure the buyer’s complaint isn’t true, but you have no way of proving it.

Or what if the buyer doesn’t understand exactly what’s included in the sale? For example, maybe you’ve included free installation as part of your product package, but the buyer interprets that as including free maintenance as well. They call you up a year after the sale is made, asking you to fix a problem—but you don’t have the time or resources to do it. 

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To avoid these types of miscommunications, you should always use a sales agreement when conducting large transactions. This way, you can make sure both your company and the buyer are on the same page.

What is a sales agreement?

A sales agreement is a written agreement between a seller and a buyer, laying out the terms of an exchange.

It’s sometimes also called a “business sale agreement.”

There are plenty of good reasons to make sure you have a watertight sales agreement in place before making a major sale or purchase. An effective sales agreement will limit the liability between both parties and create clear, managed expectations for the transaction. By putting expectations in writing, both the buyer and the seller can protect their interests, and the transaction is more likely to go smoothly. This is important not just for legal reasons, but also for the long-term future of the business relationship.

Any time you sell something that involves more than a simple transfer of ownership, you may want to use a sales agreement. Some examples of common transactions that require a sales agreement include:

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When a sales transaction takes place between two businesses (B2B sales), there are often numerous people involved. On the seller’s side, you’ll have one or several representatives from the sales team. On the buyer side, you’ll have whoever is responsible for procurement at the buyer’s organization—for example, procurement managers or executives. And of course, because we’re talking about an official contract, the legal team will probably be involved too. 

You may also have heard of something called a “bill of sale.” While this is similar to a sales agreement, the two documents aren’t the same. A sales agreement is like a contract—it’s used to define the terms of a complex transaction or ongoing project. On the other hand, a bill of sale is more like a receipt. It serves as proof that a transaction was completed. For some types of transactions, you may need both a sales agreement and a bill of sale.

How to write a sales agreement

The information below is designed to help you understand what’s commonly included in a sales agreement. However, it’s not legal advice. For help with creating a legally-binding sales agreement tailored to your specific situation, you should consult a lawyer.

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For most sales agreements, you’ll want to:

1. Identify the parties involved

Decide who will officially represent your organization in this sale. This may be one person, or it may be multiple people. Once you’ve defined who the seller representatives and buyer representatives will be, include space for their names and contact details, such as email addresses and phone numbers.

2. Provide a description of the goods and/or services being sold

Create a detailed list of the item(s) being sold. Don’t forget to also include information on related services, if they’re part of the package as well.

There are a few different types of goods you might include in a sales agreement:

3. Include details about payment

Lay out the terms of payment for your sale. This may include the payment amount(s), payment dates, and expected payment methods.

Some things to consider when drafting this section:

4. Include details about the delivery or implementation

Describe exactly how the sale will take place. If you’ve included onboarding, installation, or maintenance services as part of your sales package, this is where you can elaborate on those.

You should define:

5. Account for each party’s liability

A key part of any legal contract is defining and limiting liability. Your sales agreement should include clauses to define who will be liable in the case of loss, damage, or delivery failure. It should also describe when exactly the risk of lost or damaged goods shifts from the seller to the buyer.

6. Establish warranty information (if applicable)

Often, a seller will guarantee against defects for a certain number of years after a sale. For example, if you buy a new computer, the manufacturer might offer to repair it for up to three years after your purchase. This type of warranty is called an explicit warranty.

If you’re planning to offer an explicit warranty as part of your sale, make sure your contract contains these details:

In some jurisdictions, consumers might also be protected by a default implied warranty, such as a legal requirement that all products must be “merchantable” (fit for purpose) before being sold. This type of warranty may be modifiable if explicitly stated in a sales agreement. 

7. Address potential breach of contract and dispute resolution 

There’s always the chance that something may go wrong, and one of the parties might end up breaching the terms of the sales agreement. In this case, it’s important to set clear expectations for what should occur.

If the seller and buyer are in different legal jurisdictions, the contract should specify which country, state, or region’s laws will apply as governing law. It should also make clear which type of dispute resolution will be used to resolve the disagreement.

Some common types of dispute resolution include:

8. Define when and how the agreement may be canceled

Maybe at some point, one or both parties will decide they want to cancel the agreement and not go through with the sale. To avoid misunderstandings (like canceling an order after it has already been shipped), the sales agreement should clearly define exactly when and how the sale can be canceled.

How can sales agreement templates help streamline your processes?

A sales agreement can help both buyers and sellers protect themselves and strengthen their business relationships. However, to be effective, agreements must be well-constructed and legally sound.

As a seller, it’s important to make sure your sales agreements are accurate and precise. They should also be well-designed, attractive, and easy to read for your buyer, with clear language that both parties can understand and agree to.

These documents are the last step in your sales process—they should help you close the process well.

Unfortunately, in a B2B context, creating a good sales agreement is often a time-consuming task.

If you’re a sales professional, you might be familiar with the hassle of sending information back and forth to your company’s legal team so they can modify each contract piece by piece.

Doing this manually or over email can lead to disorganization and errors. Many companies sell at high volume, and when sales agreements keep getting stuck in “legal review”, this can be a serious roadblock in the sales process.

To avoid this back-and-forth, you can create a sales agreement template.

With a sales agreement template, your legal team will only have to create and review one initial document. The sales team can then simply “fill in the blanks” with the details of each sale.

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Create sales agreement templates with a CRM

A Customer Relationship Management (CRM) platform can help you create standardized, easy-to-use, and attractive sales agreement templates. CRM software is designed to help you automate your sales process, shorten your sales cycle, and increase revenue.

With a CPQ (Configure, Price, Quote) solution built into your CRM, you can create and share professional-looking branded documents in just a few clicks. You can use a CPQ add-on to create invoices, quotes, onboarding documents, and contracts, including sales agreements.

Before creating a sales agreement, it’s important to make sure salespeople have access to the most up-to-date, accurate information (such as product pricing and descriptions) when closing the deal. A CRM can help you centralize your inventory management, speeding up the process and lowering the risk of mistakes. It will also help you accurately calculate the final package price, taking into account taxes and discounts. In addition, you can store information on your deals in the CRM, and automatically update your documents as you negotiate with buyers.

Once you’ve created a sales agreement, you can send it out directly to your buyer using the CRM system, and track their responses to see when they open and sign it.

In short, a CRM like Freshsales can help you: