TermScout reviews and ranks contracts and contract provisions based on how favorable or unfavorable those provisions and contracts are from the perspective of a typical customer.
For each contract provision that we rank, we look at how favorable the provision is to a customer without regard to what others in the industry are doing or offering. For details on what factors we consider for individual types of provisions, click here. Once we’ve looked at other companies in an industry, we may publish the average and best TermScores for a particular provision in an industry.
Factors that influence a TermScore include:
- Does the provision offer what an average user would expect it to offer (we use a combination of surveys and market research for this prong)?
- Does the provision offer what an experienced attorney would expect it to offer?
- Does the provision seem reasonable in light of the company’s business model?
- Does the provision place undue burden or pose undue legal risk on the customer?
- Does the provision place unrealistic expectations on the customer (e.g. You should check our site regularly to see if we have changed our contract.)?
- Are there exceptions, caveats, or other factors that impact the favorability of the provision?
- Is the meaning of the provision vague or ambiguous?
To determine a TermScore for an entire contract, we calculate the average TermScore weighted by the Impact Score for that provision.
We assign an Impact Score to each material provision to measure how much we think a given provision impacts the overall fairness or favorability for the typical customer. Impact Scores vary by industry, but not by individual contract or company. For example, in industries where the customer’s intellectual property may matter a lot (e.g. services used by artists, designers, or engineers) provisions concerning intellectual property will receive a high Impact Score, and will therefore have a high impact on the overall TermScore. In industries where intellectual property does not matter for the typical customer (e.g. banking, travel, hospitality) Impact Scores for intellectual property provisions will be low.
Factors that influence an Impact Score include:
- Is the provision seen by consumers in the industry as important (we use a combination of surveys and market research for this prong)?
- Is the provision seen by the TermScout Council as important?
- Is the provision seen by the Lead Contract Analyst assigned to that industry as important.
All Impact Scores and TermScores go through at least three attorneys licensed to practice law in at least one US state (the “TermScout Council”). Where the TermScout Council does not agree on an Impact Score or TermScore, one or more additional licensed attorneys are added to the TermScout Council for purposes of resolving the disagreement.
Best in Class and other Awards
At times, we’ll award our Best-in-Class designation or other awards to a company for having the most customer-favorable provision or contract of those we’ve reviewed in an industry. If your company has received one or more such awards, feel free to tell your customers about it – you earned it! If you’d like to use our trademarks or explore other ways to help your customers better understand your contracts, email .
Our reviews offer a great way of getting a general feel for what’s in a company’s contracts, but we’re not a good tool to base large purchasing or mission-critical decisions on. Reviewing and scoring contracts is inherently subjective, and what matters to one customer may not matter to another. We are not a law firm and are not a replacement for hiring an attorney. If you are making a substantial purchase, using a service with high risk factors, or using a service for mission-critical aspects of your business, you should consult an attorney.
We take quality extremely seriously. In the unlikely event that you find an error in any of our reports, please report them to us immediately so that we can correct the mistake.