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Should I Update My Standard Terms to Reflect Customer Demands?

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As a business supplier, your standard terms and conditions are critical legal protection for your business relationships. Your terms should set clear expectations, safeguard your business against potential legal disputes, and protect you from risks. However, the commercial world is constantly evolving and savvy customers often expect more from their suppliers. As such, customer negotiations and demands are typical in business. 

As a supplier, consider updating your contract terms over time to reflect new customer demands. Doing so may allow you to secure business by negotiating contracts quickly. This article will explore critical considerations around updating your standard terms to reflect new customer demands.

How Could Updating Your Standard Terms Benefit Your Business?

The purpose of revising your terms and conditions is to help respond to customer concerns and position your business for growth. 

For instance, if there are common customer requests you are frequently asked and are low risk, you may consider updating your terms to reflect those requests. Doing so could save you significant negotiation time. 

 Updating your terms to reflect customer demands could help your business by:

  • showing your customers that your business values flexibility. Adapting your terms, such as extended payment terms, fairer termination clauses, or even bespoke solutions for high-value contracts, demonstrates a willingness to collaborate and listen to customer requests. This can demonstrate goodwill, streamlining the negotiation process and expediting deal closures; 
  • boosting customer satisfaction. Listening to customer concerns and incorporating reasonable adjustments into your terms can foster trust and build stronger, long-lasting relationships. This can help with repeat business, positive word-of-mouth referrals, and a loyal customer base; and 
  • your competitiveness as a supplier could also be increased. In a competitive business market where customers shop around, new customers may be more likely to work with your business if your terms are reasonable. Onerous or harsh terms may have the opposite impact, dissuading customers from working with you. 

What Are the Key Considerations When Updating Standard Terms?

Your terms are unlikely to be static documents. Instead, they will likely change and require edits as your business progresses. However, you should cautiously approach new terms or edits, particularly when customers request them. 

Understanding potential risks is vital when considering an update to your terms.  As such, consider the following key steps:

1. Carefully Review and Consider Potential Updates

While it is not mandatory to update your terms, it is often a good idea to take a step back and review your terms from time to time. As part of this review process, you can consider factors such as how many customers have requested specific updates to your terms and: 

  • Have you always agreed to those updates? 
  • Are they low-risk? If so, is it worth updating your terms to reflect those low-risk requests to avoid protracted back and forth with customers, causing issues each time you negotiate? 
  • Can you remove or phrase specific legal jargon more simply to avoid confusion? As we explore further, it is essential to check any such removals with a lawyer first. 

Additionally, assess the potential impact of proposed changes on your business operations and financial stability. Will accommodating specific customer demands risk profitability or operational efficiency? You must always balance the appeal to meet customer expectations with the need to protect your business interests.

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Conducting market research or gaining insights from your teams as part of this process may be helpful. For instance, speak to your sales or negotiations teams to determine which requests customers make and what the pain points of negotiations are for your teams. By doing so, you can understand which terms you need to revisit. 

For instance, if 90% of customers are asking for a specific clause to be removed and you agree to this all the time, it may be worth looking at that clause and discussing it with your lawyer to understand if this is something you should look to remove.

Furthermore, consider future-proofing your terms and conditions and other potential updates. While considering customer requests, it is also worth considering other changes to accommodate current customer demands, future growth, and possible issues a customer could ask. You can do this by anticipating future changes in your business and considering how you could adapt your terms to pre-empt future customer enquiries.

2. Always Seek Legal Advice

Legal advice is critical in updating your standard terms. Rather than navigating this process alone, consult with an experienced solicitor qualified in commercial law. Your lawyer can provide invaluable guidance on interpreting legal implications and assessing the reasonableness of customer requests. They can also offer insights into potential risks and liabilities associated with proposed updates, helping you avoid inadvertently compromising your business interests. 

By working with legal experts, you can ensure that revisions to your terms are carefully drafted to protect your rights and mitigate legal exposure. Updating your terms with proper legal advice could prevent unforeseen complications. For instance, you could remove critical provisions originally included to safeguard your business from risk if you do not work with a lawyer. Your legal team may also provide strategic advice by creating a ‘playbook’ or standardised approach to negotiating customer requests. 

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Key Takeaways

Often, standard terms are not static legal agreements and will inevitably change over time as a business grows. The decision to update your standard terms to accommodate new customer demands can be vital for maintaining competitiveness and healthy business relationships, especially where such demands are regular and a drain on time for your business. 

You can demonstrate flexibility and enhance customer service by adapting your terms to reflect key customer concerns. Updating your terms can streamline negotiations, expedite deal closures, and attract new business. However, before making any changes, careful consideration and consultation with legal advisors are essential to ensure compliance and mitigate potential liabilities. Embracing adaptability but carefully reviewing the changes and seeking legal advice are vital steps to protect your business from risk. 

If you need legal advice on updating your standard terms, LegalVision’s experienced contract lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.

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Sej Lamba

Sej Lamba

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