Protecting Yourself from the Competition & the Leaches
A good business requires constant innovation and market adaptability. Strategic marketing also sometimes requires collaboration with other establishments to capture your market’s attention, especially when your business is new. Before being able to establish this collaboration whether with other establishments, potential investors, and even the media, you will have to divulge some information about your business to lay the outline of your goal for such collaboration.
There are people out there that will want to steal your ideas and use them in their own business. Always try and use non-disclosure agreements when discussing your ideas with people.
A non-disclosure agreement (NDA) is a legal contract between two parties that states confidential material, knowledge, or information that the parties wish to share with one-another for certain purposes, but wish to restrict third party use or access to. Basically, the parties agree to not disclose the information covered by the agreement. An NDA creates a confidential agreement to protect confidential information or other non-public business information.
This legal document is usually signed when two companies or individuals are considering doing business and need to share some confidential information about their business to evaluate the potential business relationship. NDAs can also be utilised when outsourcing work – for example, a company can ask a writer to sign an NDA that states that all information gathered while writing, and the writing itself, is confidential information until the company chooses to publish it.
While signing an NDA isn’t always going to prevent a freelancer from babbling about their project, it will bridle most people from leaking out your company’s confidential information because you can sue them for violating the contract. An NDA will ensure that they know that you mean business and that you take your intellectual and business property seriously.
An NDA usually contains the following:
- The parties involved
- The definition of what is confidential – this can be very vague for the purpose of being all- inclusive
- The disclosure period (i.e. 1 year or forever)
- The term the contract is binding
- Any exclusions from what must be kept confidential (i.e. materials already available to the public)
- Any obligations to keep the information confidential
- Any types of permissible disclosure, such as law enforcement
An NDA is essential for businesses to maintain a competitive advantage in the market, especially when you are developing a new product or service. This will prevent your competitors from picking up information that may pre-empt your competitive advantage.
Starting a business can be scary, hard work and full of pitfalls, but it should also be ultimately fun and rewarding. So drive your passion to reality and protect your unique ideas!