Home > Uncategorized > Unfair contracts hitting businesses

Unfair contracts hitting businesses

'It is a standard contract - sign at the bottom. The first clause forbids you to read any of the others!'

This is an area I have encountered on a number of occasions in the past year or so. It is an are where I frequently give advice.

The familiar misconception many business owners have is that they are protected under the same rights as consumers whereas the prevailing guideline is simply caveat emptor

The research reveals the extent to which small firms remain vulnerable when buying much needed goods and services. Around 40 per cent of respondent business owners said they felt unable to do anything about the unfair contract terms they had been submitted to because a supplier was too important to their business.

Isn’t that a somewhat depressing illustration of the overriding power that certain suppliers have over SMEs?  But i would also contend that that is a defeatist attitude too

FSB national chairman Mike Cherry called for better protection for small firms when entering supplier contracts. “Small business owners don’t have the time, expertise or purchasing power to scour the market to find and negotiate the best deals,” he added.

“They behave in a similar way to consumers, but don’t have the same guarantees of quality or legal redress in an unfair situation. Small firms on the bad end of a deal are losing out to the tune of £1.3bn a yea

The problem could be that “expertise” and time comes at a price. The assumed first port of call is the legal profession but the familiar response from that sector is often over cautious and not an ability to see the contract in the wider context

Then again maybe advice is worth a little upfront cost

 

 

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