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A professional services agreement is established between an individual or company and a contractor providing services. Professional services span various industries, including lawyers, electricians, carpenters, financial advisors, and architects, requiring specialized licenses or certifications. In contrast, consulting is typically not classified as a professional service. When hiring a professional contractor, it's crucial to draft a solid contract that addresses key questions, holds both parties accountable, and prevents misunderstandings throughout the business relationship. The video will also offer a free template for creating such agreements.