How to write wholesale trade terms (with a template)
Everything your credit control process does should be written down before the first order. Here is what to include, and plain wording for each clause that you can adapt.
In short
- Trade terms are the rules a buyer agrees to when they open an account. If a rule is not written down, you will end up arguing about it when money is late.
- The clauses that matter most: payment term, credit limit, what happens when payment is late, saved card charges, interest and compensation, disputes and ownership of goods.
- Keep it in plain English. A page a buyer actually reads is worth more than ten they sign unread.
- This is a starting point, not legal advice. Have a solicitor or attorney check it for your trade and your country.
Why you need them
Without written terms, every late payment is a negotiation and every hold is a surprise. With them, your reminders can say 'as set out in our terms', your hold message can quote the clause, and a buyer who complains is reminded of what they agreed when they applied for the account.
Written terms also protect the relationship. A buyer who knows that orders pause at 14 days overdue does not take it personally when they do. The rule did it, not you.
What to include
- Who the terms apply to and when they are accepted (on application, on first order).
- Prices, minimum order and delivery charges.
- Payment terms: the term, when the clock starts, how to pay.
- Credit limit: that one exists, that it may change, what happens over it.
- Late payment: reminders, when orders pause, interest and compensation.
- Saved payment cards: that they may be charged on the due date, with notice.
- Disputes: how long the buyer has to raise one and what happens meanwhile.
- Retention of title: goods remain yours until paid for.
- Returns and damage: notice period and process.
- Contact by email and text about the account.
- Changes to terms and how you will give notice.
- Governing law.
Clause by clause
Plain wording to adapt. Replace the figures with your own and check the whole thing with a lawyer.
| Clause | Wording to adapt |
|---|---|
| Acceptance | These terms apply to every order placed on a trade account with [Store]. By applying for an account or placing an order you accept them. |
| Payment terms | Unless we agree otherwise in writing, invoices are due 30 days from the order date. Payment may be made by card through the link on your invoice or statement, or by bank transfer to the account shown on the invoice. |
| Credit limit | Each account has a credit limit. We may change it at any time and will tell you if we do. Orders that would take your balance over the limit may be declined or require payment on account. |
| Overdue accounts | If any invoice is more than 14 days overdue we may pause new orders on your account until the balance is paid. We will tell you before this happens. |
| Saved cards | Where a payment card is saved at checkout for an order placed on terms, you authorise us to charge that card for the invoice amount on the due date. We will email you at least three days beforehand and you may pay by another method before then. |
| Interest and compensation (UK) | We may claim statutory interest and compensation on late invoices under the Late Payment of Commercial Debts (Interest) Act 1998. |
| Late fees (non-UK) | Overdue invoices may be charged interest at [rate] per month from the due date until paid, where permitted by law. |
| Disputes | Tell us about any problem with an order or invoice within 7 days of delivery. Undisputed amounts remain payable on the due date. |
| Retention of title | Goods remain our property until paid for in full. Until then you hold them for us and must not sell them other than in the ordinary course of your business. |
| Contact | We may contact you by email and text message about your account, including payment reminders. Reply STOP to any text to stop further texts. |
| Changes | We may update these terms by giving you 30 days' notice by email. Continuing to order after that date accepts the new terms. |
| Law | These terms are governed by the law of [England and Wales / your state] and the courts there have jurisdiction. |
Three clauses people forget
The dispute window. Without one, a buyer can raise a query about a delivery three months later to delay paying the whole invoice. Seven to fourteen days is normal, and it should say that the undisputed part is still due on time.
Retention of title. If a buyer fails owing you money, goods you still own can sometimes be recovered; goods you have sold on credit cannot. The clause is standard and costs nothing.
Contact by text. Texts are the most effective reminder channel for small trade buyers. A line saying you may text about the account removes any doubt about whether you can.
Terms that get read, and terms that do not
Do not get read
- Twelve pages adapted from a corporate supply agreement.
- Defined terms in capitals throughout.
- A clause for every possible event.
- Buried in a PDF nobody opens.
Get read
- One to two pages in plain language.
- The figures that matter, in bold: term, limit, hold point, dispute window.
- Sent with the welcome email and linked from every statement.
- Summarised in five lines on the credit application form.
Where to put them
Link them from your wholesale sign-up page, send them with the welcome email, and quote the relevant clause in your overdue notice and hold message. In Terms Due the reminder templates have a merge field for a terms link, so every message points at the same page. If you update the terms, send the notice by email and keep the old version with its dates.
For the credit application that goes with them, see our trade credit application guide.
Questions
Do I need a lawyer to write trade terms?
You can draft them from this guide, but have them checked. The cost is small compared with one unrecoverable debt, and some clauses, such as interest and retention of title, work differently in different countries.
Can trade terms be accepted online?
Yes. A tick box on the application form or a line in the welcome email saying that ordering accepts the terms is normal. Keep a record of the version and the date.
Should terms be the same for every buyer?
The document can be. The figures, such as term and limit, can be set per buyer in the agreement or on the company record in Shopify and Terms Due.
Can I change terms for an existing buyer?
With notice, yes. Thirty days by email is usual. For a change that matters to one buyer, such as moving from Net 60 to Net 30, tell them directly as well.
What about terms for buyers in another country?
The payment, limit and hold clauses work anywhere. Interest, compensation and governing law depend on where the contract is governed, so take advice for your main export markets.
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