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Supply of Goods Terms of Business UK (2026 Guide)

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Written by Brad Askew Solicitor (non-practising)
Brad is on the roll of solicitors of England & Wales but does not hold a practising certificate and does not provide legal advice.
Updated June 2026 · England & Wales
If you sell goods to other businesses or to consumers, the written terms you trade on will quietly decide a great deal about how disputes play out, when you get paid, and what happens if a customer becomes insolvent. Standard terms of business give you a consistent framework that applies to every order, rather than negotiating from scratch each time. For suppliers, that consistency is commercially valuable. It also means you can build in protections that the default legal position does not give you, such as keeping ownership of goods until you have been paid in full. This guide walks through what these terms typically cover, the clauses worth paying attention to, and the common questions suppliers ask before putting a set in place.

Overview

Terms of business for the supply of goods are the written rules that sit behind each sale a supplier makes. Rather than drafting a fresh contract for every order, a supplier publishes a single set of terms that applies whenever a customer places an order and those terms are properly incorporated into the deal.

They cover the commercial mechanics most sales share, how orders are placed and accepted, when price and payment fall due, how and when goods are delivered, who bears the risk of damage in transit, when title passes, what warranties the supplier gives, and how liability is limited. They may also address cancellation, returns, late payment, data handling, and the law that governs any dispute.

In England and Wales, the underlying legal framework draws on the Sale of Goods Act 1979, the Supply of Goods and Services Act 1982, the Consumer Rights Act 2015 where consumers are involved, and the Unfair Contract Terms Act 1977 where limits of liability are concerned. Well-drafted terms work with that framework rather than against it.

Key steps

  1. Decide who you are actually selling to. The legal rules shift depending on whether your customer is a business or a consumer. Consumer sales carry protections under the Consumer Rights Act 2015 that cannot be contracted out of. Business-to-business sales allow more room to allocate risk, but you still need to be reasonable. Start by mapping your customer base honestly.
  2. Cover the core commercial terms clearly. Your terms should set out how an order is formed, what the price includes, when payment is due, what happens on late payment, how delivery works, and when risk transfers. Vague wording here is where most real-world arguments start, so use plain English and be specific about dates, amounts, and responsibilities.
  3. Think carefully about title and risk. A retention of title clause keeps ownership of the goods with you until the buyer has paid. An all monies version extends this so title only passes once every outstanding invoice has been settled, not just the invoice for those specific goods. Risk, meaning who pays if goods are damaged, usually passes earlier, often on delivery.
  4. Set realistic limits of liability. Suppliers commonly cap liability by reference to the price paid and exclude indirect or consequential losses. These clauses are only enforceable if they are reasonable, and some liabilities, such as death or personal injury caused by negligence, cannot be excluded at all. Review the balance rather than simply copying broad exclusions.
  5. Incorporate the terms properly into every sale. A set of terms sitting on your website is not automatically part of the contract. You need to bring them to the customer's attention before or at the point the order is accepted, ideally by referencing them on quotes, order confirmations, and invoices. Review the wording periodically as your business and the law evolve.

Common questions

If you're dealing with this kind of situation, a call with an experienced legal adviser can help you work out the right next step — from £89.

Common questions

Q What is the difference between a retention of title clause and an all monies clause?
A basic retention of title clause keeps ownership of specific goods with the supplier until the buyer has paid for those particular goods. An all monies clause goes further and holds back title until the buyer has paid every sum owed to the supplier across the whole trading relationship. The all monies version is generally stronger for suppliers, particularly if a customer becomes insolvent.
Q Do I need separate terms for consumers and business customers?
In many cases yes. Consumer sales in the UK are governed by the Consumer Rights Act 2015, which gives consumers protections that cannot be excluded, such as rights around goods being of satisfactory quality and fit for purpose. Business-to-business terms can allocate risk more freely. Using a single set for both groups often means the terms either overreach with consumers or underprotect you in trade sales.
Q When does risk in the goods pass to the buyer?
This depends on what the contract says. If the terms are silent, the default position under the Sale of Goods Act 1979 is broadly that risk passes with property, though consumer sales follow different rules under the Consumer Rights Act 2015. In practice, many supplier terms state that risk passes on delivery while title is retained until payment. Being explicit avoids arguments over damage in transit.
Q Are limitation of liability clauses always enforceable?
Not always. The Unfair Contract Terms Act 1977 and, for consumers, the Consumer Rights Act 2015 test whether exclusion and limitation clauses are reasonable or fair. Liabilities such as death or personal injury caused by negligence and fraud cannot be excluded at all. Overly broad wording can be struck out by a court, so limits should be proportionate to the deal and the risks involved.
Q How do I make sure my terms actually apply to a sale?
You need to incorporate them into the contract before it is formed. Common approaches include referencing them clearly on quotations, order acknowledgements, and website checkout pages, and making the full text easy to access. If a buyer sends their own purchase order with conflicting terms, a battle of the forms can arise, so how and when each side sends documents matters.
Q Can I charge interest on late payments?
In business-to-business sales, the Late Payment of Commercial Debts (Interest) Act 1998 gives a statutory right to interest and reasonable recovery costs if payment is late, even without a contract term. Many supplier terms set their own rate, which must be a substantial remedy to displace the statutory rate. Consumer contracts are treated differently and need careful drafting to be enforceable.
Q Do my terms need to be signed to be binding?
Not necessarily. A contract on standard terms can be formed without a signature if the terms are brought to the buyer's attention and the buyer goes ahead with the order. That said, signed terms or a clear tick-box acceptance give you much stronger evidence if there is ever a dispute about what was agreed, so signatures or recorded acceptance are worth pursuing where practical.
If you're dealing with this kind of situation, a call with an experienced legal adviser can help you work out the right next step — from £89.

Sources

This guide is based on primary UK law and official guidance.

Brad Askew, Solicitor (non-practising)

Written & reviewed by

Brad Askew Solicitor (non-practising)

Brad is on the roll of solicitors of England & Wales but does not hold a practising certificate and does not provide legal advice. LegalDocuments.co.uk is not a law firm and does not provide regulated legal advice.

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Legal disclaimer
This article is for general information only. It is a tool to help you find your way — not legal advice, and not a substitute for speaking to a qualified adviser about your situation.