A contract comes into existence when three conditions are met.
Firstly, both parties (e.g. buyer and seller) must be capable of making a contract, and must intend to make a contract. (For example, business negotiations may be conducted 'subject to contract' specifically to avoid forming a contract before all the main terms have been agreed.)
Secondly, an offer must be made and accepted. For example, you could offer a product for sale, and the purchaser could agree to buy it. Equally, a customer could make an offer to purchase your product, and you could accept their offer.
Finally, something of value must be exchanged: for example, the seller's product for the customer's money. Note that the customer does not have to pay immediately. If the customer promises to pay (for example, when you sell on credit) that promise counts as something of value, so a contract exists.
