Disputes with suppliers can be disruptive and stressful for any business, and veterinary practices are no exception. Whether it involves late deliveries, incorrect products, poor service or invoicing irregularities, issues with suppliers can impact your practice’s operations and ultimately affect patient care and your relationships with your clients.
Here, we provide some advice on avoiding disputes and how to deal with them efficiently if they do arise.
Prevention is key
It will come as no surprise that the best way of dealing with disputes is to prevent them from arising in the first place. Here are some proactive steps you can take:
Sort out your contracts
Ensure your contracts with suppliers are clear and legally sound. A good contract should be clear on key aspects such as product specifications, delivery timelines, payment terms and dispute resolution procedures.
Even if a supplier insists on using their standard terms, it is still possible to negotiate specific changes, so don’t be afraid to try – but remember to record any variations in writing
You may not always be able to negotiate contract terms, but if you make a deal on a supplier’s standard terms, make sure you have read and understood them so you know what you can and cannot expect. Bear in mind that most suppliers will have standard terms that favour them, and, as a business, you have less protection from “unfair” terms than a consumer does. If in doubt, consider seeking legal advice before you commit. Even if a supplier insists on using their standard terms, it is still possible to negotiate specific changes, so don’t be afraid to try – but remember to record any variations in writing.
Thorough ordering
Double-check orders before finalising them, ensuring the accuracy of product details, quantities, pricing and timescale. Deal with any ambiguities in advance. If there are any specific or unusual requirements for your orders, communicate them clearly and request specific confirmation.
Good communication
Maintain open and regular communication with your suppliers. Discuss any concerns promptly and keep records of all interactions, including emails and contemporaneous notes of phone calls. Many disputes arise because of simple misunderstandings or miscommunication and are exacerbated because each side often thinks they are in the right, so having a “paper trail” to support your position is essential.
Many disputes arise because of simple misunderstandings or miscommunication and are exacerbated because each side often thinks they are in the right
When disputes arise: a step-by-step approach
If you encounter a dispute with a supplier, follow these six steps:
1) Gather information
Document the nature of the dispute with your supplier, including dates, details of the issue and any relevant evidence (eg invoices, delivery receipts, product photographs). It is often helpful to prepare a brief chronological narrative – this will help you ensure you have understood the situation correctly. It can also be used to communicate a clear picture to the supplier.
It is often helpful to prepare a brief chronological narrative – this will help you ensure you have understood the situation correctly
2) Raise the issue
Start with a polite and professional approach – there may well be a simple explanation for the problem and a simple solution. Contact your designated supplier representative and explain the situation clearly. Aim for a resolution through open communication and negotiation.
In most cases, you can reach a resolution early; using positive and collaborative language helps. Accusatory and inflammatory language can put the other side into a more defensive position – after all, in most cases both sides will want to preserve the relationship.
3) Seek support
If initial attempts to solve supplier disputes are unsuccessful, consider involving your colleagues for guidance. In addition, escalating an issue to a more senior team member (on your own side and with the supplier) may be necessary. It may also be sensible to consider speaking to your legal advisors, particularly before taking any significant steps (such as terminating a contract).
4) Formalise the dispute
If the issue persists, it may be necessary to adopt a more formal approach, setting out your claim in writing. Often, this will be in the form of what is referred to as a “letter of claim” or “letter before action”. This is a letter that is sent as a precursor to issuing court proceedings. It should detail the factual and legal basis of the dispute, provide key documents you rely on and set out the desired outcome (eg replacement product, price adjustment).
If the issue persists, it may be necessary to adopt a more formal approach, setting out your claim in writing
You should give the supplier a reasonable time to provide you with what you want or set out the basis on which they dispute your claim – typically, this would be at least 14 days.
You can write this letter yourself, but in complex or higher-value disputes, you may want to instruct solicitors to help you. If you cannot resolve the supplier dispute in formal correspondence, the next formal step would usually be to issue a claim at court – but see also step five!
5) Consider alternative dispute resolution
Alternative dispute resolution (ADR) is a term for different ways of resolving disputes that do not involve the court. At its simplest, negotiating face to face or by telephone or email is a form of ADR. Other more formal methods include mediation (a non-binding process where a neutral third party tries to facilitate the parties reaching a negotiated settlement) or arbitration (a process where a third party makes a binding determination), which can be faster and less expensive than court proceedings.
Even when a court case is ongoing, it is often resolved by some parallel form of ADR because a negotiated settlement is often better and less risky for both parties
Even when a court case is ongoing, it is often resolved by some parallel form of ADR because a negotiated settlement is often better and less risky for both parties.
6) Be flexible and commercial
In most supplier disputes, each side thinks they are in the right and the other side in the wrong. Sometimes the position is clear cut, but more often than not there is some grey area at the centre of the dispute. As more details and documents come to light, the view of the dispute may (need to) change. Do not become entrenched, and always be prepared to re-evaluate your position; this is particularly important when you are looking to negotiate a settlement.
Do not become entrenched, and always be prepared to re-evaluate your position; this is particularly important when you are looking to negotiate a settlement
There may be good reasons to make a bigger concession if it will facilitate a settlement and avoid the risks, delays and costs of prolonging the dispute. You can also think creatively about how to negotiate a settlement – rather than obtaining a refund, for example, can you negotiate a discount on future orders?
Additional considerations for veterinary practices
As a veterinary practice, specific factors may influence how you handle supplier disputes:
- Impact on patient care: look at the impact the supplier dispute may have on patient care. If resolving the issue with a specific supplier will create risks or involve significant delays, consider seeking alternative suppliers to ensure uninterrupted care. Recognise that this may mean that you have to look beyond the legal and commercial basis of the dispute sometimes and take steps which you may otherwise have tried to avoid
- Regulatory compliance: Ensure your actions throughout the dispute resolution process adhere to the RCVS Codes of Professional Conduct for Veterinary Surgeons and Registered Veterinary Nurses
- Reputation: Veterinary practices depend on their reputations. Be conscious of the impact of your actions in the dispute on the reputation of the practice among clients and in the industry. For example, it may be tempting to try to use social media to pressure a supplier but this will rarely look good to clients (even if you are completely in the right)
Summary
By following the steps above, you will be able to avoid disputes and, if this is not possible, deal with them efficiently so your practice can focus on what is most important – delivering care to patients.
