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It is imperative that any business offering its Customers credit knows exactly who they are dealing with. Is your Customer a Limited Company, a Sole Trader/ Proprietor, a Partnership, a Registered Charity? The easiest way to find out is to send your potential Customer an Account Application Form, This Form can also be used to get your Customer to agree to your Terms & Conditions. Do not think it’s unreasonable to ask a customer to supply you with this information, they are applying for your Credit, imagine trying to get Credit from a Bank without supplying such information. 
Terms & Conditions 
It is imperative that any Business has its own set of Terms & Conditions, these Terms set out the relationship between you and your Customer. Each industry will have Terms that are industry specific, but ALL Businesses should have basic Terms dealing with the following 
Data Protection. You must have the permission of an individual to carry out any kind of Credit Search, therefore you need a Data Protection Waiver 
Credit Terms. You need to confirm your Credit Terms and confirm when and how those Credit Terms can be cancelled/withdrawn. 
Jurisdiction. You must stipulate that in the event of any legal dispute, that your transactions are all subject to English Law. If your Customer is not based in England then without this agreed Term it is not certain which Court has jurisdiction. 
Retention of Title. You must stipulate that your goods remain your property until you have been paid in full. 
Late Payment Interest. You can claim Statutory Late Payment interest at 8% plus the current Bank of England rate. However, it is not unreasonable to suggest you will charge 15%. 
Recovery Costs. You must stipulate that you will hold your customer liable for all reasonable Recovery Costs. This means you are legally allowed to charge Recovery Costs late payment and allowable costs without the need to take Legal Action. 
The examples above are just a small sample of the complexity needed to create a good set of Term & Conditions, and the matters that need to be covered by them. NPD can provide a basic Account Application Form and a Standard set of Terms & conditions for a small fee, please contact 020 8665 6666 or contact us via webform HERE. 
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