The Importance of Terms and Conditions When Starting a Business

When you’re starting a business, there are many different details to consider, both small and monumental. And while you may naturally find yourself devoting a lot of time and effort to the major questions, some of the smaller issues may slip your mind.

One such question revolves around your terms and conditions. How will you outline them and explain them to your customers or clients? After all, they form the basis of your relationships. As such, they should be well thought-out and considered.

Protection for Your Business

Terms and conditions serve to protect all aspects of your business, from cash flow to your reputation. If they’re written well and cover all the important points (which we’ll get into in a moment), they will provide some much-needed coverage.

Reassurance for Your Clients and Customers

Terms and conditions will also help provide a vital layer of reassurance to your clients, especially when you’re just starting out. Clients want to work with businesses they can trust, and knowing what they can expect from you, as outlined in your terms and conditions, will allow them to understand what you offer and what you demand in return.

Reliability and trustworthiness has become critically important in a world where online shopping is becoming the new normal and where anyone can set up a website in an aim to defraud customers. Knowing that they are protected by a binding document will inspire others to do business with you, as opposed to another new company that lacks this kind of protection.

Prevention for Litigation

Your terms and conditions are also important for protecting you from any potential lawsuits. If they clearly outline everything they should (which we’ll cover next), you will be covered in the eyes of the law and you will save the resources you may otherwise be spending on legal fees.

Now that you understand the importance of crafting terms and conditions for your business, let’s take a look at some tips on how to make them work for you and your customers or clients.

How to Write Terms and Conditions that Work

Having terms and conditions alone is not enough. You need to write out a document that covers all your bases and important points. Otherwise, you may find you’ve left a loophole open that can seriously harm your business.

To save yourself some time, you can use an automatic generator for your terms and conditions. It will help you come up with a basic outline, and then you can add in any information that may be missing.

Define Your Products or Services

Depending on what your company does, you want to outline and define in detail what your products and services are. This will be the basis of your terms and conditions, and the basis of your relationships with your clients and customers.

Set Clear Payment Terms

When payments are due and in what form is another important fact you should include in your terms and conditions. List all the payment options you accept, as well as the penalties incurred for late payments.

List Your Guarantees or Warranties

Any warranties or guarantees you offer for your products or services should also clearly be outlined in your terms and conditions. They will lend another layer of credibility and reliability to your brand.

Timelines for Delivery

Delivery timeframes should also be defined, with a very important note on potential delays. This is crucial for ecommerce brands, as your customers will look to your T&Cs if your products are late in arriving.

Termination Conditions

You also want to define what constitutes the termination of your agreement, and what any penalties, refunds, and other procedures will be if this does happen.

Points to Consider

To make your terms and conditions personalized to your business, keep in mind the following points:

  • Consider everything that can go wrong, and outline what you will do, or what the other party needs to do, if a particular situation arises.
  • Write for an irritable, awkward, and ignorant customer – it will make your terms and conditions easier to understand.
  • Think things through from your client’s point of view as well.
  • Ask for professional advice if you’re not quite sure which direction to take.

Final Thoughts

If you follow our advice and consider everything we’ve discussed in this post, you should be able to write out terms and conditions that will protect your business as well as help your clients and customers commit to a business relationship with you. Most importantly, you’ll be able to come up with wording that is easy to understand.

Remember that your terms and conditions don’t need to be short, and they don’t need to be complicated. The important thing is that they’re easy to understand, and they’ll be as lengthy as they need to be to cover all the important points.