Whatever products or services you provide, the smooth running and profitability of your business depends on good relationships with your customers.
In most cases, things run smoothly. However if and when things go wrong in a business relationship, you’ll need a legally enforceable document to fall back on.
That’s where your terms and conditions (T&Cs) come in.
Your business’s T&Cs need to spell out, in clear and simple language, exactly what you agree to do or provide for your client – and when. They should state your payment terms and what action you’ll take if anything goes wrong or the client fails to meet their side of the agreement.
T&Cs are important as they can protect you from any number of problems. For example, if you’re going to incur costs on a client’s behalf, state that you need payment up front to minimise your exposure to that expense if the client pulls out of the agreement early. If a client is late paying you or disputing your invoice, you’ll need the T&Cs to show a court exactly how late the payment is, why you’re demanding the payment and that the client agreed to your terms in the first place.
The list of potential problems you could face is endless and will be unique to the nature of your business.
For this reason, you’ll need a T&Cs document bespoke to your business. Avoid the temptation to download a copy of your competitor’s T&Cs and change the names and addresses. At best, these will have been written specifically for that business, so won’t necessarily be relevant or beneficial to yours. At worst, they may have been tweaked from another source with no input from a qualified lawyer.
To ensure your T&Cs cover every possible eventuality, spend some time thinking about all the things that could go wrong at every stage of your client relationship, from the moment you agree to work together to the day your final invoice is due. Draw on any previous experience you’ve had in contract disputes and try to think like a difficult customer.
Then, write down what, ideally, you’d want to be in a position to do to remedy each problem. Include also:
- exactly what products or services you’ll be providing,
- the details of assurances you’ll provide by way of guarantees,
- when you’ll fulfil your side of the agreement,
- what will happen if either you or the customer terminate the agreement,
- which law governs your T&Cs.
Having set out all the potential pitfalls and worst case scenarios and decided how you’d like to respond to them, the final stage is to create a set of T&Cs that are legally enforceable. Unless you’re a contract lawyer, you’ll probably need professional help at this stage.
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