Three Tips for Setting Your Service Terms and Conditions

Posted on
Three Tips for Setting Your Service Terms and Conditions

When you’re setting up a business, your service terms and conditions are often the last details to get a look in.

Let’s face it, they’re nothing like as interesting or compelling as deciding on your business name, office location, product details, prospective customer base and advertising method.

They do, however, have the power to make or break your business. Without clear and comprehensive terms and conditions, misunderstandings between you and your suppliers or customers can mean a nightmare of delays, unpaid bills and outstanding client accounts.

Here are three tips to help you set your terms and conditions.

  1. Pinpoint why your business needs them

It’s basically about protecting your fledgling business, specifying the duties, rights, roles and responsibilities involved in all your two-party trading arrangements.

This means your customers know how and when they should pay you, your suppliers know how and when you will pay them, and any joint venture partners know the exact nature of the business arrangement which exists between you.

Your terms and conditions mean you will be covered in the event of pay or trading disputes between yourself and customers, suppliers or partners.

The also provide the legal proof you need in the event of having to front up in court and fight your corner.

  1. Be clear about the specific clauses you need

Your terms and conditions need to pre-empt problems, so it’s a useful exercise to set out your worst-case business scenarios, along with plans of action for each possible event.

You’re heading for trouble, for example, if you think your customer is paying you at the start of the project, and they think they’re paying you at the end of it.

So it’s essential to establish a clear, precise and easy-to-understand definition of:

  • Products and services which will be provided to the customer.
  • Payment terms for the customer – how and when you require payment for your products or services.
  • Guarantees and warranties offered to customers – which are covered by the company manufacturing the item, for example, and which are offered by yourself as provider of the service to install, deliver or fit it.
  • Timelines regarding supply of product or service, customer payment and lodging of any complaints.
  • Supplier requirements and specifications regarding timeline for supply of goods, timeline for payment and supply of defective goods.
  • What will happen if customer or supplier accounts remain unpaid. It’s vital to have a clear understanding of proceedings if either party defaults on the agreement or wants to end the trading relationship.
  1. Get expert help

It’s advisable to consult a lawyer specialising in this area to draw up a sound and comprehensive legal document right at the start of your business life. Spending the time and money to get it right from the beginning can help to lower the risk of problems down the track.

A lawyer can be especially important if you are planning to sell goods online. This is an area with its own specific legalities, and a raft of fair trading and consumer protection laws exist in the field of ecommerce. You can also check out the legalities of digital trading in Australia through the federal government’s Department of Communications website.

Along with watertight terms and conditions, efficient telecommunications are also a prerequisite when setting up a new business.

Consider 1300 numbers, 1800 numbers and virtual fax when setting up your office, giving you a head start when it comes to connecting with customers, suppliers and other vital business contacts.