The success of any business depends on the contracts it makes. Whether you’re buying goods or services from suppliers or selling to customers, the terms that govern those deals impact your legal rights, financial risk, and efficiency. That’s why it is important for businesses to have their own terms of purchase and terms of sale—not just rely on those provided by the other party.
-
Control and clarity in commercial property transactions
Using your own terms ensures that you can carefully set out what each party must do. Your terms of sale set out how you expect to be paid, when ownership and risk transfer, what warranties you offer, and how disputes will be resolved. Similarly, your terms of purchase dictate the standards you expect from suppliers, including delivery timelines, quality requirements, and remedies for defective goods or services.
Without your own terms, you risk being bound by the other party’s conditions—often drafted to favour their interests.
You can make sure the legal rights and obligations you have are suited to the way your business operates.
-
Mitigating legal and financial risk on commercial property sale or purchase
One of the most important reasons to use your own terms is risk management. For example, your terms of sale can include limitations on liability, disclaimers of certain warranties, and clauses that cap damages. This protects your business from excessive claims or unforeseen liabilities.
On the purchasing side, your terms can require suppliers to carry insurance, indemnify you for third-party claims, or comply with specific regulatory standards. These provisions are crucial in industries where compliance and quality control are non-negotiable.
-
Avoiding the “battle of the forms” in commercial transactions
In many commercial transactions, both parties attempt to impose their own standard terms. This often leads to what’s known as the “battle of the forms,” where each side’s terms conflict. If not properly managed, this can result in uncertainty over which terms apply—or worse, a court deciding the outcome.
By proactively issuing your own terms and ensuring they are incorporated into contracts, purchase orders, or invoices, you strengthen your position in any such conflict. Better still, negotiating and agreeing on terms in advance can prevent disputes altogether.
-
Streamlining operations and expectations
Standardised terms help your colleagues operate more efficiently. Sales teams know what payment terms to offer. Buyers understand what delivery standards to enforce. Legal and finance departments can rely on consistent risk profiles across contracts.
This consistency also benefits your customers and suppliers. When everyone knows what to expect, transactions proceed more smoothly, and relationships are built on mutual understanding rather than reactive problem-solving.
-
Protecting your brand and reputation
Your terms can also include ethical and compliance standards—such as anti-bribery clauses, data protection obligations, or sustainability commitments. These provisions not only protect your business legally but also reinforce your brand values and corporate responsibility.
For example, if a supplier breaches environmental regulations, your terms of purchase can give you the right to terminate the relationship and distance your brand from reputational harm.
-
Tailoring to your business needs
No two businesses are alike. Off-the-shelf terms may not reflect your specific industry, risk tolerance, or the actual way you operate. By drafting your own terms, you can tailor them to your unique business—whether that’s managing international trade risks, handling digital goods, or addressing subscription-based services.
In today’s complex commercial landscape, relying on the other party’s terms—or worse, having no terms at all—is a gamble no business should take. By using your own terms of purchase and terms of sale, you gain control, reduce risk, and create a foundation for smoother, more predictable transactions. It’s not just a legal formality—it’s a strategic advantage.
This article was brought to you by Kidd Rapinet’s commercial solicitors. You can book an appointment with any of the commercial lawyers across our other offices in Aylesbury, Canary Wharf, Farnham, High Wycombe, Maidenhead or Slough, using the form provided.
These materials and content have been prepared for the benefit of their viewers/readers. They are intended for marketing purposes only and are of a general nature and do not constitute legal advice applicable to any particular facts or circumstances. Kidd Rapinet LLP and/or the author(s) accept no duty of care, responsibility or liability for any loss or damage which you or any third party may suffer as a result of any reliance or use by you or them of these marketing materials and content, except to the extent it is not legally possible to exclude such liability. If you require legal advice on your own situation, please contact us so we can discuss how we may assist.