Reading the fine detail: Business focus on T’s and C’s

Business units in London. Image by Tim Sandle

There is so much to think about when starting a new business, including logistical decisions when selecting suppliers and service providers. This leads to the related question ‘what new business owners should look out for in potential suppliers’ T&Cs?”

In the UK, 563,847 new businesses opened between 2022 and 2023 (according to Companies House). Entrepreneurs are founding new SMEs all the time, and a big part of setting up a company is with choosing the right suppliers.

Yet pinpointing what a businessperson need to look out for in the terms and conditions is not straightforward. For example, when considering signing a contract with an energy provider or a commercial landlord, what precisely should be specified?

Philip Brennan, Founder and MD at BusinessComparison tells Digital Journal about a new guide his team has put together: “We put this guide together to help new business owners choose the suppliers and contracts that will suit their needs best. Every provider will have a slightly different offering and range of contracts to choose from.”

Brennan adds: “Although it might feel overwhelming to weigh up all your options, there are lots of opportunities to save money, which you could put into your business.”

Bank accounts

Brennan advises: “Business bank accounts might come with special features especially designed for businesses and startups such as free invoicing services, so look in the T&Cs to see what each account offers. You should also make yourself aware of the costs and charges associated with the account, and check whether it allows card payments.”

Commercial lease

Brennan thinks: “When preparing to sign a commercial lease agreement for business premises, consider the length of the lease that the landlord is offering, and whether it would be possible to leave earlier if needed. Business owners would also be wise to check the lease agreement terms and conditions to see if property alterations such as refitting the kitchen are mentioned. Your business’ legal representative should review the lease agreement – these are just a few things you and your team can look out for in the contract.”

Changing premises

For moving location, Brennan cautions: “If you move into your business premises and there is already a contract in place with an energy supplier, it’s likely that it will be what is called a deemed contract. These can be much more expensive than a contract you negotiate yourself, by as much as 80 percent- it’s sensible to try and exit. You might be able to save money based on the type of tariff you sign up for, as well as the payment method – monthly direct debits are often cheaper.”

Internet

To be properly and securely connected, Brennan puts forward: “When choosing a broadband provider, make yourself aware of the policy around switching. Avoid mid contract price rises by selecting a broadband provider with a ‘fixed price promise’ for the duration of your contract with them. You might also wish to consider a telecoms bundle that also includes Voice over Internet Protocol, which allows you to take business calls on a landline number via a digital line.”

Payment solutions

Merchant services and payment solutions may offer extra services such as tech and customer services support, notes Brennan: “Check the T&Cs to see what each supplier offers, as well as checking how flexible the contract is. Will you take card payments? Interchange plus is perhaps the most common payment plan, in which you pay a small percentage of each payment – there are also flat rate contracts, but while this pricing is very simple, it can be less cost-effective.”

Insurance

“Which insurance you need will of course vary on the nature of your business, but any company that either receives client visits or makes visits to client and customer houses will need Public Liability Insurance”, advises Brennan. “If you have a company van, you might need a different insurance plan depending on what you use it for.”