Do Protect: Legal Advice for Startups (Do Books) by Johnathan Rees

Author:Johnathan Rees [Rees, Johnathan]
Language: eng
Format: epub
Publisher: The Do Book Company
Published: 2014-04-27T00:00:00+00:00

The moral of the story is to adopt good credit control systems, establish good lines of communication at the right level with your customers narrowing the scope for dispute, and make yourself a (friendly) nuisance.

Sub-contracting

It may be that a particular contract involves skills which are not within your expertise or capacity, in which case you might engage a third party or ‘sub-contractor’ to perform the relevant functions on your behalf. This is quite common in the construction industry, for instance, where a developer might engage a number of different organisations from architects to bricklayers for a contract it has entered into.

The important thing to remember is that when you engage a sub-contractor you will remain responsible for their mistakes. For that reason you should ensure that your sub-contractor is required to protect you against any claims you suffer which relate to their performance and that they are adequately insured.

Suppliers

While all the issues covered above under ‘Customers’

are no less important when dealing with suppliers, it is fair to say that in the vast majority of cases when you’re buying you will have less ability to control the process. Certainly when dealing with utilities and large corporates (software providers and the like) the idea of engaging in contract negotiations is both unrealistic and, frankly, undesirable. There is little point wasting your time, energy and money on conversations which will only ever have one ending – and it won’t be written by you.

But this is definitely not the case where the purchase is a bespoke or significant one-off order – perhaps a new website. In those situations the likelihood is that your bargaining position is stronger and you should try to ensure that any key commercial matters are covered.

These might typically include:

- A clear brief setting out what you expect from

your supplier and describing the product as precisely as possible.

- Whether any period should be allowed for ensuring that the product does what it is intended to (and holding back all or part payment until you are satisfied).

- Getting assurances (warranties) from the supplier about the condition, functionality or durability, etc., of the product and spelling out the supplier’s obligations if there turns out to be a problem (particularly if you are giving similar assurances to your customer).

- The price (what is included in it) and payment terms.

It would be wise to engage a lawyer to draw up a template of standard purchase conditions for you which are sufficiently broad to allow you to adapt them to different circumstances.

Routes to Market

In terms of selling your product and reaching your potential customers there are a number of avenues, from online trading to engaging a sales agent. There is much to be said for getting others to do the hard work of finding buyers for your product and assuming the risks which go with selling it. This becomes increasingly relevant where you are considering selling overseas. Beyond direct sales that you may choose to make in person (e.g. your shop) or through your website, your

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