Incorporating your terms into contracts

Take five guide - Incorporating your terms into contracts   

Your business may have terms and conditions of trade detailing what you agree to provide and what you expect from customers you supply to.

However, it’s important to communicate these effectively and incorporate them into your contracts of supply – there’s no point having them if you don’t!

Here are our tips for making sure your terms apply to all of your contracts.


1. Ensure terms are proactively sent

Ideally, have your customer sign your documentation (for example and order form or acceptance of proposal) containing your terms. This can be on paper, or an electronic signing platform such as DocuSign or similar is fine.

If that’s not possible, firstly make sure that your customer is given reasonable notice of your terms before they place an order.

To do this, include the terms in all relevant pre-contract documents: quotations, proposals, statements of work and so on, and state that they will apply to your sale of goods, services, or software.


2. Put terms where they can be found

It’s no good hiding or sneaking in terms if a customer can then reasonably claim they weren’t aware of them before they made an agreement with you.

For example, if your terms only appear on invoices, that’s no good – the contract has already been formed by the time the invoice has been sent, and the terms won’t apply.

Sending a link to a web page with terms, instead of attaching them in full to a quote or proposal, is fine – just be sure that the terms are up to date and the link works.

It's acceptable – although not ideal – to print Ts and Cs in small print to appear on the back of documents, as long as the front of the document clearly states they are there, and the small print is readable.


3. Be wary of the content of Purchase Orders

Sometimes a customer will send a standard purchase order in response to your quote or proposal, and this may refer to their own purchase order terms.

Keep a sharp eye out for these – if their purchase terms are referenced, your acceptance of that order will confirm that their purchase terms apply. It is often the case that these terms will benefit the customer more than the supplier. Make sure that the team receiving orders know what to look out for and are vigilant.


4. Take the last shot in the battle of the forms

When you’ve said that your terms apply and your customer sends you their own terms, this can get into a situation known as ‘battle of the forms’. To win this ‘battle,’ and have your terms apply, you need your terms to be the last ones sent between you and your buyer before acceptance of the order or the contract starts to be performed (this is called the ‘last shot’).

To send the last shot, send an order acknowledgment, referring to your terms of sale, and don’t start to perform the contract until you’ve done so. You can never be sure that you’ll win the battle of the forms, because the customer might return fire with their last shot, so take care with this approach.


5. See terms as a positive

Don’t be scared of your terms and conditions, see them as a boring necessity or try to hide them. Customers who are considering engaging with you will often see it as a positive that you are upfront about them and may choose you over a competitor who gives a less clear idea of their terms.

It’s good practice to include your terms anywhere else that you can – for example on websites, customer portals or platforms, emails and invoices. With the right approach, they can become a helpful part of the sales process, cement trust in your business and support its growth.


Would you like to know more?

 Thrings Business Growth helps businesses thrive by providing practical business advice from commercial specialists.


Thrings legal take five guides