Why do you need terms of trade?
Your terms of trade define how you do business. You might consider that some terms are implied, but implied terms will never replace expressed terms or terms that are in writing. You might already be familiar with the concept of an ‘agreement’ or a ‘contract’ (ie, a legally binding agreement), so consider your terms of trade as your contract with your customers or clients.
In that contract you can determine things like what you’re going to do for them and what they’re going to do for you in return (ie, payment).
You might cover other things like time for payment and penalties for late payment, or you might detail issues like warranties, guarantees and maybe return policies. The extent and detail of your terms of trade really depend on the nature of your business and the risks that you wish to manage.
If your business is all about ‘point of sale’ transactions that happen over the counter, you might not have a written contract with each of your customers but you may need to have notices regarding return policies clearly visible around your shop. If you extend credit to your customers, you might require your customers to provide security in the form of personal guarantees or maybe even an interest over some kind of property. If you trade over the internet, your website might contain your terms of trade as part of the website or the online shopping cart. Or if you do business by quoting and signing up customers, you might place your terms and conditions on the back of your quoting form and ask customers to sign their acceptance of the quote as well as your terms.
The bottom line is that there’s no specific rule regarding how your terms of trade should be reflected in your business, and you need to assist your business or sales procedure to determine at what point in time do you ‘have a deal’. That’s when you need to concentrate on ensuring that your customers or clients have clearly understood your terms of trade and have accepted them. Finding the right balance between what is commercially acceptable and legally enforceable is not easy, and sometimes you need to find an acceptable compromise that protects your interest but does not hinder your ability to do business – and that’s exactly where we can help.
Why choose Phang Legal for your business?
There are many lawyers and law firms to choose from, but it can be challenging to make the right choice. At Phang Legal we are dedicated to serving other business in the best way possible – after all, we know what it is to run business and to be a consumer of professional services ourselves. We appreciate the value of professional advisers who can provide the right service at the right price and we aim to be what we expect most. We deliver nothing less and we think you should expect nothing less.
With our offices conveniently located in Parramatta, the geographic centre of the Sydney metropolitan area, our lawyers assist businesses from across all suburbs of Sydney and beyond.