INVOICE BEST PRACTICES
Unfortunately, timely payments and collections are habitual issues in the cannabis industry. Accordingly, including defined late terms, collection stipulations, acceptance criteria, and jurisdiction on an invoice is a best practice. Including these notes on a signed invoice is proven to increase collections success, as the mere threat of litigation can often improve your position on a creditors list. These can be input in the notes section of a QuickBooks generated invoice.
It is always best practice to use transport companies that enforce a strict signature on delivery policy.
If there are major concerns of non-payment for a larger order, best practice dictates getting a notarized personal guarantee. A personal guarantee does not have the same legal hurdles as a cannabis business contract, and provides greater protection in the event of a business going into receivership. If real estate is used as collateral, obtaining a mortgage on the property is advised.
Curaleaf has demonstrated that if afforded the opportunity, MSO's will do anything they can to get out of an unfavorable contact. This includes taking disputes to Federal court to argue the contract is unenforceable due to marijuana's Federal status. To offer some protection against this, it is advisable to include a statement that the invoice states "exclusive jurisdiction in Michigan state courts"
