It’s possibly the best problem any business owner can have: not enough stock to service the orders. While this might mean you’re business is selling a lot of its stock and that business is great, it also highlights the importance of having a well-drafted ‘Availability and Cancellation’ clause in the Sales Terms and Conditions.

This clause will not only explain the business’ policy in the event that there is no stock but it will also address cancelation of orders when a customer is no longer interested in purchasing the product due to its delay. A business lawyer with contract-drafting experience is the most appropriate person to draft a this clause and should certainly be consulted before you start advertising your business’ Sales Terms and Conditions on your company website.

How should an ‘Availability and Cancellation’ clause be drafted?

Get your business lawyer to draft the following provisions into the clause:

o   First of all, the clause should clearly state that all purchases are subject to availability. You may wish to add a provision that states you will do your best to ensure that stock is replenished, or that the products database on the website will be regularly updated. Either way, it’s important (to your customers and to your business model) that your business take responsibility in the event that you cannot supply the product to your client;

o   If there is a considerable delay in delivering a customer’s order, the clause must explain how the business will deal with this scenario. Explain that your business will ‘contact’ the customer using his or her contact details attached to the order and that the customer will be provided with various options, such as a refund, store credit, or a backorder (to be delivered upon arrival of more stock, for example);

o   Make sure that, upon electing ‘store credit’ or ‘delivery’, the customer is refunded any amounts paid for shipping/delivery;

Some businesses may wish to include a provision that allows the business to send the customer a product that is very similar to the original when the original is not available. This may extend to allow the business to request permission to substitute the ordered product for a product that is quite different in appearance, value and size. If this is the case, make sure a business lawyer, at the very least, reviews what you have drafted to ensure it is foolproof.

Conclusion

If your business is delivering goods from out of state or overseas, it’s not unlikely there might be a situation whereby the business will need to notify the customer of some sort of delay in delivery or inability to deliver the particular product. It might be that stock has run out, or perhaps the product has been misplaced and is being located. Either way, have a business lawyer from LegalVision look over the contract to ensure that you have not glazed over these important details.

COVID-19 Business Survey
LegalVision is conducting a survey on the impact of COVID-19 for businesses across Australia. The survey takes 2 minutes to complete and all responses are anonymous. We would appreciate your input. Take the survey now.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. For just $199 per month, membership unlocks unlimited lawyer consultations, faster turnaround times, free legal templates and members-only discounts.

Learn more about LVConnect

Need Legal Help? Get a Free Fixed-Fee Quote

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

Our Awards
  • 2019 Top 25 Startups - LinkedIn 2019 Top 25 Startups - LinkedIn
  • 2019 NewLaw Firm of the Year - Australian Law Awards 2019 NewLaw Firm of the Year - Australian Law Awards
  • 2020 Fastest Growing Law Firm - Financial Times APAC 500 2020 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review 2020 AFR Fast 100 List - Australian Financial Review
  • 2020 Law Firm of the Year Finalist - Australasian Law Awards 2020 Law Firm of the Year Finalist - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer
Privacy Policy Snapshot

We collect and store information about you. Let us explain why we do this.

What information do you collect?

We collect a range of data about you, including your contact details, legal issues and data on how you use our website.

How do you collect information?

We collect information over the phone, by email and through our website.

What do you do with this information?

We store and use your information to deliver you better legal services. This mostly involves communicating with you, marketing to you and occasionally sharing your information with our partners.

How do I contact you?

You can always see what data you’ve stored with us.

Questions, comments or complaints? Reach out on 1300 544 755 or email us at info@legalvision.com.au

View Privacy Policy