Most small distributors operate without formal written terms and conditions. They have a general sense of their policies — net 30 terms, no returns after 7 days, $500 minimum order — but those policies live in people's heads, not in documents that buyers have agreed to in writing. This is fine until it isn't: a dispute over a damaged shipment, a buyer who claims they never agreed to your payment terms, or an account that wants to return product after 60 days and expects a full credit. A written T&C document doesn't prevent disputes, but it gives you a clear basis for resolving them.
What Your Wholesale Terms and Conditions Should Cover
A wholesale T&C document is not a legal contract that requires a lawyer to draft — though having legal counsel review it is worth doing at least once. For most distributors, a clear, plain-English document covering the following areas is sufficient:
1. Payment Terms
This is the most important section. Specify: what your standard terms are, when payment is due, acceptable payment methods, late payment fees, and credit hold procedures.
Sample language: "Payment is due within 30 days of invoice date (Net 30) unless otherwise agreed in writing. Accounts more than 15 days past due are subject to a 1.5% monthly service charge on the outstanding balance. Accounts 30 or more days past due will be placed on credit hold; no new orders will be processed until the overdue balance is paid in full. We accept ACH, check, and major credit cards. A 3% processing fee applies to credit card payments."
2. Return Policy
Specify what is returnable, the time window, who pays for return shipping, and how credits are issued. Different rules for damaged goods (where the distributor is responsible) versus buyer remorse or ordering errors (where the buyer is responsible) should be clearly distinguished.
Sample language: "Claims for damaged, defective, or short-shipped product must be reported within 5 business days of delivery. We will issue a credit memo or replacement shipment at our discretion. Product returned for buyer error (incorrect quantity ordered, change of mind) requires prior written authorization and is subject to a 15% restocking fee. Returns must be in original, unopened packaging. Perishable or temperature-sensitive products cannot be returned once delivered."
3. Minimum Order Requirements
State your minimum order value or quantity clearly, along with what happens when an order falls below the minimum — a small-order fee, a delivery surcharge, or the order being declined.
Sample language: "Minimum order for delivery is $250. Orders below $250 may be placed for will-call pickup only, or may be accepted with a $25 small-order surcharge. Minimums may vary by product category and will be noted in the product catalog."
4. Pricing and Price Change Notice
Price lists are subject to change. Specify how much notice you give, how accounts will be notified, and whether orders already submitted at old pricing will be honored.
Sample language: "Prices are subject to change with 14 days' notice. We will notify active accounts of price changes via email. Orders submitted before the effective date of a price change will be honored at the prior price. We reserve the right to adjust prices without notice in response to extraordinary cost increases."
5. Delivery Terms
Specify who owns the goods in transit, what happens when products are damaged in transit, delivery windows, and signature requirements.
Sample language: "Risk of loss passes to the buyer upon delivery. Delivered orders are FOB destination — we are responsible for goods damaged in transit if reported within the claims window specified above. Delivery windows are estimated and may vary due to weather, traffic, or operational factors. A signature may be required for orders exceeding $500. Unattended delivery is at the buyer's risk."
6. Account Termination
Reserve the right to terminate accounts for non-payment, fraudulent behavior, or other cause, and specify what happens to outstanding balances.
Sample language: "We reserve the right to suspend or terminate any account at our discretion, including for non-payment, fraudulent applications, or behavior that is abusive to our staff. Upon termination, all outstanding balances become immediately due. We will make reasonable efforts to fulfill orders already in process at time of termination."
7. Governing Law
Specify which state's law governs disputes and where any legal action must be filed.
Sample language: "These Terms are governed by the laws of the State of [Your State]. Any disputes arising from this agreement shall be subject to the exclusive jurisdiction of the courts of [Your County], [Your State]."
How to Get Accounts to Agree to Your Terms
A T&C document only protects you if accounts have agreed to it. The cleanest approach: include T&C acceptance as part of your account application. A checkbox statement — "I have read and agree to [Company Name]'s Wholesale Terms and Conditions" with a link to the full document — creates a clear record of agreement. Store the date of acceptance with the account record.
If you're adding T&C to accounts that already exist, send an email announcing the new terms with an effective date 30 days out. For accounts using a B2B portal, require T&C acceptance at the next login. Any order placed after the effective date constitutes acceptance of the current terms.