Free management contract templates (Australia)

Explore how a management contract can benefit your business investments today.

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A management contract can be a great way to reduce risk, maximise time and maybe even increase profit. This article shows what a management contract is and how it might benefit your business.

What is a management contract?

A management contract is an agreement by an enterprise owner. The agreement is usually with a management company hired to run the enterprise. The goal of a management contract is the successful running of a business. An example of this would be if someone bought a hotel without having hotel management experience. In order to run the business it becomes necessary to contract the management of the hotel to a separate company.

The terms of the management contract set the responsibilities of the property manager and also the fee for their service in managing the business. The written contract gives the operational control of the company to the management company.

management agreement template from Lawpath

Download this template at Lawpath

When should I use a management contract?

A common example of a management contract might be in the case of an investment property. For example, it would be difficult to manage a small rental property interstate or even overseas. In that case, the business may benefit using a management contract to hire a property manager. Some of the benefits of this include saving your time, reducing stress and potentially increasing your profit. A management contract can be used when there is a lack of management expertise and it will be more cost effective than self-management.

Management contract vs franchising

The key difference between a management contract and franchising is the way business risk is distributed in the partnership.

Under contract management an organisation hires a company to perform a specific task. It effectively gives operational control of a specific department like marketing, production or technology. Then the hired company makes all necessary decisions for that particular department to maximise profit and minimise risk.

Franchising is a licensing contract between the owner or agent of a company and a buyer of the brand name company. McDonald's is an example of franchising. Here the franchisee gets the right to use the trademark and name of the franchisor. The franchisee can be required to pay a percentage of sales in royalties to the company as a franchise fee.

What is included in a management contract

  • Type and level of control a management company will have on the organisation
  • Fee to be paid to the management company and how often it will be paid
  • How performance will be evaluated
  • Management contract duration
  • Penalties in case of breach of contract
  • Cooling off or probationary periods at the commencement of the contract

How effective is a management contract?

Management contracts give two immediate benefits:

  1. The business may be run more efficiently under a management contract.
  2. It frees up time in the organisation.

What this means is that hiring a business that specialises in management contracts can make your business run more efficiently and more profitably.

Do I need a lawyer for a management contract?

Management contracts give the right to the managing company to handle a particular department of your business. With the business operations contracted to another business it is important to make sure your business's legal position is strong. Though you can draft a contract by yourself you should consider contacting a lawyer before finalising the contract as the cost of litigation can be significant. Paying for appropriate legal advice when drafting the contract could end up saving many thousands of dollars should an unforeseen problem occur.

Legal documents templates like a management contract can be found on the following websites.

Name Product Legal document services available Free legal documents available? Other legal services offered Price Document library size
Lawpath
Customisable document templates
You can view samples for free and you can create your first document for free.
Online document eSignatures, lawyer marketplace, on-demand legal advice, business setup services
$288 per year for unlimited documents
300+
Customise and download up to 300 legal documents for business or personal matters. Plus register a company, business name or ABN.
LawDepot
Customisable document templates
Free one week trial available which gives access to hundreds of documents.
Free legal articles and resources
$59.88 per year for unlimited documents or one-off documents available for $9.50 - $49
150+
Customise and download legal documents in as little as five minutes. Plus, LawDepot offers peace of mind with two service guarantees.
Legal123
Customisable document templates
No
Custom legal services available, free law change updates via email, legal packages for various professions
Individual templates start from $59 + GST
Legal123 offers a range of individual templates or document packages for consultants, app developers, personal trainers and more.
LegalVision
Customisable document templates & professionally drafted documents
No
Legal advice phone consultations, contract reviewing and amendments, trade mark applications, business structure assistance.
From $49 + GST per week for access to 40+ legal templates
40+
Take advantage of unlimited legal advice consultations, free legal templates and fast turnaround times for legal projects with LegalVision membership.
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How do I write a management contract?

While writing a management contract you should at least consider the following points:

  • A management contract should contain the level of control or what responsibilities the management company has
  • The contract length and potential renegotiation periods
  • The service fee and any penalties for potential breach of contract
  • If the management contract relationship starts with a trial period then the scope of the work should be mentioned

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