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When starting a new business, there is a never-ending list of tasks to complete. Finalising your products and then marketing them are usually at the top of that list. But, ensuring that your sales terms and conditions are in place is a crucial factor in establishing arrangements with your customers. Your sales terms and conditions play an essential role in protecting your business and ensuring that both you and your customers are aware of each other’s:

  • rights;
  • roles; and
  • responsibilities. 

This article will outline some of the key clauses that you should include in your sales terms and conditions.

Products and Orders

Your sales terms and conditions should outline how a customer can request to purchase your products and how your business will handle the request. Your clause about orders should address:

  • where you list the products you have on offer;
  • how and why you may accept or reject and order. For example, accepting an order may depend on the availability of your products;
  • who is responsible for verifying the details of the order. For example, you may wish to outline that your customer cannot cancel their order if they enter the incorrect details; and
  • how your customers can track the progress of their order.

Payment

Sales terms and conditions should always include a clause relating to payment. It should specify:

  • how your customers can make payment;
  • how you receive payments; 
  • when you will not accept or allow payments;
  • that your customer agrees to pay the price that you advertised plus any additional charges, such as delivery; and
  • the currency. 

Delivery

Having an efficient and reliable delivery system in place ensures that your customers receive their products on time. This will be a massive factor in the success of your business. Your delivery clause should cover the following information.

Location

You need to specify where you deliver your product. 

For example, you should state whether you deliver your products Australia wide, or only to certain states or metropolitan areas. You should also note if there is a pickup option available.

Cost

Delivery incurs fees, and it is vital to note whether or not you will charge your customers for delivery. 

For example, you may wish to provide your customers with free delivery if their order is over a certain value. 

Timing You should provide your customers with an estimated delivery time frame which is based on your delivery company’s information. These time frames may depend on how far your customer is based from your warehouse. You should also outline what the delivery times will be during holiday periods.
Liability

You should specify that your customers are responsible for the details they enter for delivery. This minimises your legal responsibility if, for example, your customer enters a wrong delivery address. 

You should also note that your delivery company is responsible for ensuring your products are delivered to your customers.

Cancellation 

If business is booming, you may run of stock to continue servicing your orders. Having a clause that addresses what happens if there is no stock is crucial in ensuring your customers are aware of your processes. In your cancellation clause, you should outline:

  • that orders are subject to availability. You may also want to describe that you aim to ensure stock is regularly replenished and updated; and
  • how you will deal with a delay. This may involve sending your customers a similar product, or offering a cancellation and refund. 

Returns, Refunds & Exchanges 

The Australian Consumer Law (ACL) outlines the different guarantees and protections of consumers. Under the ACL, your customers have the right to ask you for a refund, repair or replacement if your product does not meet its guarantees under the ACL. It is crucial that you comply with these guarantees, so that you do not get in trouble with the Australian Competition and Consumer Commission.

Some of the ACL guarantees include that your products must:

  • be of acceptable quality;
  • match the descriptions made in your advertising; and 
  • meet any impressions you have made on their performance, condition and quality.

For your sales terms and conditions to be in line with the ACL, you should outline the process of how your customers may return, refund and exchange your products. This clause should clearly set out:

  • that your customers must provide you with a receipt proving they purchased your product that they would like to return, refund or exchange;
  • the time period during which customers can make returns;
  • which products that can be exchanged or refunded;
  • if you run an online business, who is responsible for the cost of sending a product back to you;
  • that you require evidence of any defects if the customer is claiming your product is defective; and
  • any warranties.

Key Takeaways

Your sales terms and conditions are an essential legal document that should clearly set out the arrangement between your business and your customers. A well-drafted set of terms and conditions will minimise any legal risks and future disputes with customers arising. If you have any questions or need assistance with drafting sales terms and conditions, contact LegalVision’s contract lawyers on 1300 544 755 or fill out the form on this page.

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