MAKE YOUR FREE Terms and conditions for sale of goods to business customers

Terms and conditions for the sale of goods to business customers (also known as T&Cs) should be used if you want to sell goods to another business customer on standard terms. They should cover key issues such as orders, delivery, pricing, payment, risk, warranties, defects, liability and confidentiality.

Protect your business-to-business (B2B) transactions with clear and fair terms and conditions for the sale of goods to business customers. Use these terms and conditions for any business in England, Wales or Scotland that sells goods to other businesses. They are designed to be straightforward and comprehensive so that customers know where they stand and needless disputes can be avoided. 

This document is GDPR compliant.

Use these terms and conditions:

• when you are selling goods to another business
• to make it clear where everyone stands if something goes wrong
• when you want your terms of business to be the same for every sale
• when you are supplying custom-made and/or standard goods

These terms and conditions cover:

• sale and contract formation
• price and specification
• delivery
• warranties
• liability for defective goods or breach of contract

Terms and conditions for the sale of goods to business customers protect your business interests, ensure that customers know where they stand and help avoid disputes.

T&Cs should appear on the back of all contractual documents, including quotations, order forms, acknowledgements of orders, delivery notes or in a brochure or catalogue. They should be available to a customer before or at the time an order is placed. This helps to ensure they are binding.

The terms can allow for prices which have been individually agreed with the buyer. If a price is not individually negotiated and set out in the order, any price list should be brought to your customer's attention before the contract is entered into. It can be published on a website or be available on request.

Once an order has been made and accepted, it is binding and it is up to you to agree to any subsequent cancellation by the customer. If you want certain conditions to be met on cancellation such as payment of a percentage of the price of the goods this should be specified in the T&Cs.

If you are agreeing prices individually with a customer, you may be able to vary the price of goods before delivery, but the terms and conditions should specify the conditions under which this can happen (eg (i) events beyond your control such as increase in costs of labour or materials (ii) changes to the buyer's order and (iii) delay caused by the buyer).

Such terms should allow for cancellation of the contract within a certain period of time. It should be noted that price increases will often be commercially unacceptable to the buyer and will probably not be appropriate if the goods have been purchased through a published price list.

You should specify, in the T&Cs, the length of time a client has to pay an invoice upon receipt. You can include a rate of interest on late payments in the terms and conditions. It should not be too high, otherwise it may be deemed invalid. If there is nothing in the agreement that specifies how much interest is to be paid, then the statutory interest rate applies which is 8% above the Bank of England base rate of 0.5%.

You should specify, in the T&Cs, a period of time after which you can resell or otherwise dispose of goods which a customer refuses to accept.

When a business deals with another business, some terms will be implied by statute unless specifically excluded by the contract. Your customer is entitled to expect that the goods provided:

• correspond with any description of the goods given by the seller
• are of satisfactory quality (ie safe, in working order and free from defects)
• are fit for purpose (ie they do what they are meant to do)
• correspond with any sample supplied

The difference between business-to-business contracts and contracts with consumers is that some of these rights can be excluded in contracts between businesses. However, any exclusion, even in a business-to-business contract, must be reasonable to be valid. You should note that there is an absolute ban on excluding or restricting liability for death or personal injury resulting from negligence. If you're ever unsure about what terms and conditions can be excluded in your business to business agreement, Ask a lawyer.

Ask a lawyer for:

• selling goods using consumer credit agreements
• selling goods using doorstep selling methods
• financial services products

These terms and conditions are governed by the law of England and Wales or the law of Scotland.