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Many businesses extend credit to clients without implementing thorough terms and conditions, leaving both parties vulnerable.  Although there is no legal requirement to establish terms and conditions, they are crucial for clearly outlining the transaction’s provisions, including duties, rights, roles, and responsibilities.  In essence, ‘if it’s not in writing, there’s no proof’, making terms and conditions vital for safeguarding your business.

While the specifics of terms and conditions will vary based on the services each business provides, key elements to consider include:

• Description of the product or service
• Payment terms
• Delivery details
• Guarantees or warranties
• Retention of title
• Cancellation policies
• Breach of contract provisions and governing law

Among these, payment terms are very important.  They should specify when payment is due and the consequences of late payments.  If stated in the terms and conditions, businesses can charge interest on late payments from the due date until full payment is received, along with reasonable legal costs if legal action is necessary for recovery.

Without clear terms and conditions, businesses cannot claim interest and legal costs before court action, although they can still claim these upon initiating legal proceedings.  For a limited company’s clients, including a personal guarantee, can ensure that, where the director signs on behalf of the company, they guarantee to repay any debt that the company may be unable or unwilling to pay.

Implementing tailored terms and conditions can help you avoid costly disputes, manage customer expectations, and enforce your rights.  These terms must reflect the specific needs of your business.

At David Allen Recovery Solutions, we can assist with drafting tailored terms and conditions to meet your unique business requirements.  For more information, contact our specialist team at 01228 713070.