What is an offer?
An offer is a clear proposal to enter a contract on stated terms, showing an intent to be bound if it is accepted.
An offer is a clear proposal to enter a contract on stated terms.
Where the word "Offer" comes from
Offer is ancient contract language for the presenting of terms. Modern law requires the offer to show a real intent to be bound if accepted, a standard developed through centuries of English and American case law on when a proposal ripens into a contract.
Why Offer matters
An offer starts the deal; only when accepted does a contract form. Identifying whether a statement is an offer or merely a solicitation decides whether an acceptance creates a binding agreement or nothing at all.
Common confusion about Offer
An advertisement is usually an invitation to negotiate, not an offer. Advertisements, price tags, and catalogs generally do not bind the seller, because the law treats them as invitations for customers to make offers, which the seller may then accept or reject.
A real-world example of Offer
A shop posts a bike at a marked price. That is usually an invitation to offer; your request to buy at that price is the offer the shop may accept, and the sale is complete only when the shop accepts, typically by ringing it up.
A worked example of Offer
A homeowner emails a neighbor offering to sell a lawnmower for $300, stating the offer is open for five days. The neighbor accepts on day three. Because the offer was clear, definite, and accepted on time, a contract exists, and the homeowner cannot sell to someone else. Had the email merely said the lawnmower was available, the neighbor's reply would be the offer, and the homeowner could decline.
How Offer works in practice
When making an offer, state the price, subject, and timeframe clearly so acceptance creates an unambiguous deal. When receiving one, respond precisely and on time, because a late or modified acceptance is treated as a counter-offer that kills the original. Put any deadline in writing, and remember that some offers can be revoked before acceptance unless an option is purchased.
Questions about Offer
Can I revoke my offer?
Yes, before it is accepted, in most cases.
What makes an offer valid?
Clear terms and an intent to be bound if accepted.
Is a price tag an offer?
Typically no — it invites offers from customers.