4 out of every 5 UK small businesses are owed money, that’s a total of around £14bn in unpaid invoices. But what can be done to crack down on your firm’s late payment troubles? TM Law solicitor Aidan Squire explains why Non-Standard Terms and Conditions (in conjunction with a detailed invoice) have the power to ensure payment, or if not, enforce the debt through the courts.
Why Non-Standard Terms and Conditions Matter
Whether you supply services or goods, it is incumbent upon you to ensure your business has a clear contract with your clients/customers.
A statement of;
- what you are proposing to do for your customers/client
- the price of doing it (a quotation),
- a letter of acceptance stating precisely who the parties, a description of the job, the price, and (frequently) a time scale,
- time for payment when the job is complete.
Read more about the fundamentals of Terms and Conditions in our recent blog >>
Don’t think a ‘Standard Terms and Conditions’ document is enough to protect your business through. And don’t be tempted to re-use Terms and Conditions from another business.
The reality is, each business needs Non-Standard Terms and Conditions, tailored to their specific products, services, processes and payment terms etc, to be effective.
Non-Standard Terms and Conditions should be designed to ensure that the contract is defined in more detail and include clauses relating to responsibility for insurance, and when acceptance of risk for the delivery of goods takes place.
This is particularly vital when your business supplies goods, and the more complicated the supply chain the more important it is to have Non-Standard Terms and Conditions.
The document gives you the opportunity to define responsibility and liability, ensure that your own systems apply, and that you minimise your own risk once the goods have left your premises.
Obligations to report delayed delivery or defects can also be very helpful.
When these ‘business specific’ terms are collated into a single document business often present them on the rear of an invoice.
This is not acceptable. At the very least these terms should appear on the rear of a quotation or estimate, as this is the document that preludes to an agreement being entered.
Once the contract has been entered into by the customer/client, and they have placed an order, any detailed terms and conditions which are then brought forward will be ineffective and irrelevant.
“We always advise business owners to avoid using the term ‘Standard Terms and Conditions,” says Aidan. “It gives the impression that they are of a standardised nature that would apply across the board. Many can be, but most must be specifically designed for the business itself”.
“Your trading and the contracts that you enter into with your customers/suppliers are at the very heart of your business. It is vital to make your Non-Standard Terms and Conditions available to customers prior to their order; be this on a website or on the back of a quotation. They must be clear and must be accepted by the customer”.
As solicitors who have extensive expertise in this area, we would strongly recommend that you consult us. We can guide you through what can be tricky and important document, and ensure your Non-Standard Terms and Conditions are designed to protect the heart of your trading and profitability.
TERMS & CONDITIONS CONSULTATION
About TM Law – Specialist Commercial Solicitors
Based in Hockley, Essex, TM Law is a small and dedicated solicitors. With many years’ experience, helping business owners and local individuals with matters of personal injury, compromise agreements, employment disputes, debt collection, commercial disputes and much more.
As a specialist commercial and debt recovery solicitors, TM Laws’ knowledge of the debt recovery system available to recover money is second to none, and their approach is proven to achieve maximum recovery for minimum outlay on behalf of local business.
For a personal service, practical advice and quick recovery of your money contact us today. We offer a fair, fixed fee service and we’re always happy to help.
The post Standard or Non-Standard Terms and Conditions? The Difference Is Important appeared first on TM Law Solicitors.
This blog post was originally featured on this members own blog.