Business Contract Termination Letter and Its Sample

A business ends a contract with another business on a daily basis & for various reasons. In this case, a business contract termination letter will document the event for both parties. In this article, we will focus on discussing such a letter. So, let’s pay attention to the following discussion!

How to Make a Business Contract Termination Letter

Creating this kind of letter is not difficult. Here, you will need to follow the step by step below:

  • Before entering the first paragraph, you have to politely greet your client first.
  • In the introductory paragraph, you should directly provide the reason what the business contract is terminated.
  • You also need to state that you would like to terminate the contract.
  • Then, the effective date of the termination should also be stated clearly.
  • Next, it is also good to provide reasons or facts as your client pertains to the situation.
  • If there are services or monies, you must note them that they are owed by both parties.
  • In addition, you are also required to note how the items are handled.

Tips for Creating a Business Contract Termination Letter

There are some important tips that will be useful for creating such a letter. So, make sure that you consider the following tips:

  • First, you have to use a tone & wording displaying professionalism.
  • Besides that, it must be to the point, clear, simple, and concise.
  • Then, you should follow the proper format.
  • In addition, you must also pay attention to spelling and grammar.
  • The reasons for the contract termination also have to be acceptable.

Business Contract Termination Letter Sample

For your inspiration to write this kind of letter, you can pay attention to the following sample.

Dear Mrs. Hanna,

This letter informs you that I won’t use Brahma Restaurant as the main supplier for my catering business from November 15th, 2020. Please accept this as the official notification in our contract. I terminate our contract because of a change in the business strategy for Frank’s Catering. Even though I’m satisfied with the quality of the products you provide, I have a plan to change the menus of my catering.

We position our company as a catering service for weddings. Now, our business will change to be catering for corporate events. That is why I decide to find another supplier that suits my restaurant’s new concern.

We know that this contract termination needs to be negotiated first so that we both agree on the contract termination. I believe that you can find other restaurants to be supplied. I also hope for the success of your supplying company.

Thank you for the outstanding service provided by your company. If you want to arrange a meeting with me to discuss this contract termination further, you can contact me via phone at (111)-111-1111. You may also send an email to

That is all about a business contract termination letter. You have to create this kind of letter with your own reasons for the contract termination.


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