How to get your trade terms right

The battle of the last piece of paper

How can you define the best terms and conditions of trade for your company? In today's trading environment the importance of protecting your business cannot be understated. It is essential that your customers are presented with your terms and conditions at the earliest opportunity so that they know how to behave and what is expected of them in the event of any dispute arising.

An area which is often overlooked is the need for a legally drafted set of standard terms and conditions of trade which specify how your company does business with its customers.  In addition, your terms and conditions of trade will also protect your company's commercial rights and seek to minimize potential liabilities in the event of a dispute arising.

At the same time, the purchaser will place orders for goods and services which will contain their own set of terms and conditions.

Your trade terms must be right for your company. A good set of terms and conditions should cover the following areas:

  1. Definitions (e.g. "buyer", "seller")
  2. Quality
  3. Price
  4. Quotations
  5. Delivery
  6. Retention of title
  7. Risk
  8. Terms of payment
  9. Notification of disputes
  10. Time limit for notification of disputes
  11. Right to interest and compensation for debt recovery costs
  12. Acceptance of goods
  13. Force Majeure
  14. Applicable law and jurisdication
  15. Warranties and liabilities
  16. Severability
  17. Insolvency and bankruptcy

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