Watch Out for The Small Print! Businesses Lose Billions for Failing to Spot Terms and Conditions
40% of small enterprises wont challenge an unfair contract if they feel the supplier is too important or powerful
UK small businesses have lost nearly £4bn in the last three years due to dodgy contracts with large suppliers, according to new research from the Federation of Small Businesses (FSB).
The FSB’s latest report Treating Smaller Businesses Like Consumers – Unfair Contract Terms’ revealed that 2.8 million small enterprises have been victims of underhandedness by suppliers, with 75% of those affected being hit at least twice in the past three years.
Suppliers failing to make auto-rollover clauses clear up front (24%) was the biggest gripe of business owners, followed by lengthy notice periods (22%), high early termination fees (20%) and concealed details in the small print (20%).
When placed in such a situation, 40% of small firms said they felt ‘powerless’ to do anything about the unfair contract terms as they deemed the supplier to be too important – suggesting smaller businesses have no more standing ground than the average consumer.
Mike Cherry, FSB National Chairman, said:
“Small businesses don’t have the time, expertise or purchasing power to scour the markets to find and negotiate the best deals. Small businesses owners behave in a similar way to consumers, but they don’t have the same guarantees of quality or legal redress in an unfair situation.”