Terms of business are something that every business has – and needs. However, they aren’t necessarily something that every business wants to spend too long negotiating, nor are they something that most businesses are proud of. Just over a year ago, we wrote an article about terms of business. We set out to explain why terms of business were becoming a point of difference for some businesses – legally designed terms of business anyway.
We were inundated.
Not only had we written what was (and continues to be) our most successful blog to date, but our phone rang non-stop with companies wanting to know how they could convert their tired terms of business into something that would help them get more business!
This series, explaining terms of business in more depth, follow-up that original blog with more information. In the year since our first ToB article we have been asked lots of questions! We wanted to share some of those questions – and our answers to them – with you here.
what should be terms of business contain?
One of the most common questions we’ve been asked is what should your terms of business contain? Essentially your terms of business should set out the way you will be conducting business with your customer/client. They should set out those basic terms that will remain the same again and again.
The 7 things everyone should consider when creating terms of business are:
1. what you are selling.
What you are selling might be something that you need to include in your Ts&Cs. Where this varies a lot, however, you might prefer to set out a description separately. The more standard your product/service, the more it makes sense to include it within your terms.
2. price and payment terms.
Will you charge interest on late payments? How much will it be and when will it kick in? Are there any additional charges that might accrue and how will they be dealt with? These are all questions that are typically answered within a company’s terms of business.
3. data protection.
There are certain data protection clauses that your clients will expect to see within your terms and conditions. In fact, it’s a legal obligation to have agreed data protection rules between you and your clients (as there’s always going to be some form of data sharing)! The more data (and the more sensitive data) that is being shared, the more likely these terms will come under scrutiny.
Who is on the hook and for what? This is the “what if x happens” clause that is the one most likely to be the subject of arguments when something does go wrong. Make sure you are happy with what you are signing up for.
5. intellectual property.
Intellectual Property clauses govern who owns what with regards to intellectual property. These clauses are particularly important where something new might be created under the contract. It is often the IP that is where all the value sits, so these clauses should be detailed and work for you.
This is particularly important if you sell services. Rather than sign a separate NDA (if you want to go down that route, see here for a free version), you might like to include the confidentiality clauses in your general terms and conditions.
Often terms of business will set out when the contract will end. This might be for positive or negative reasons.
terms of business – legally designed.
Hopefully, that was plenty of food for thought! In the rest of this series we will also be considering the different types of terms of business, how often they should be updated, and why we feel that legal design can have a hugely beneficial impact on your terms of business!
If you’d like to see how we can help you then please get in touch for a free consultation at email@example.com.