You have finally won that tender to provide products or services to a major corporate, after several attempts over a period of time. Prior preparation will help you manage your risks, be it legal or commercial, in your business dealings with that major corporate. You need to understand what you are getting yourself into and how to best manage the relationship, ideally on a long term basis. It is important to also count your cost to see if you are up for the task.
What are some of the issues to consider and the controls you need to put in place?
- Major corporates are big on information security. Ensure that you have controls in place to protect and secure their information. If the product, for example, is a technology product like software, ensure that your software, when plugged into their systems, will not introduce viruses and other issues.
- Have a plan in place in terms of how you will process, store and record their personal information (that aligns with the Protection of Personal information Act of 2013, as amended from time to time “POPIA”). The plan should cover, amongst other issues, data breach incidents and how they will be managed when they arise. Understand what your roles and responsibilities are in terms of POPIA.
- Have a cyber security plan in place to deal with cyber security incidents when they arise. Understand that there are penalties for non compliance with Cybersecurity laws.
- Confidentiality – Have a plan in place to deal with the big corporate’s confidential information, especially with your personnel. Consider who will get access to the confidential information and the access control issues.
- Familiarise yourself with laws on anti-corruption and bribery, as you will be required to adhere to their anti-bribery policies.
- Contractually, be prepared to take on some risks especially around issues of, without limitation, liability, indemnities, warranties, or intellectual property. Do not negotiate your contracts without legal representation. Major corporates always have legal representation for contractual negotiations. Some startups and small businesses tend to negotiate without legal advice, often putting their businesses at risk. Please also ensure that the product or service is thoroughly defined in the contract to avoid future disputes that may be costly.
- Stakeholder management – Aim to build a long term relationship of trust with the relevant stakeholders. Ensure that you perform your obligations under your contract competently with minimal to no issues. Prompt communication that is founded on mutual respect, whenever there are issues and follow ups will help you build a sustainable business relationship.
It is advisable to have legal representation from the moment you are selected as a winning bidder for work with a major corporate, to ensure that your business interests are adequately protected. Whilst it is exciting to do business with a major corporate, you must also be proactive and put your ducks in a row, to ensure that you are ready for the task at hand. As soon as they send you their contract for review, please reach out to us for legal advice. At MHM Attorneys, we are able to put both the business and legal hats, respectively, in contractual negotiations as we have worked both in-house and in practice. We will identify legal risks in the contract and help you mitigate or avoid the risks identified. Please reach Hazel on: 0824088884 or email us at: info@mhmattorneys.co.za
The content provided in this article is for information purposes only. For legal advice on your unique circumstances, please contact an attorney.
