Model General purchasing agreement basic (aka long-term supply agreement) for the long-term supply of products or services with strategic relevance for the core business of the customer
In a General purchasing agreement, basic in length and comprehensiveness, the parties agree on the main parameters for the ongoing, long-term supply of products or services by the supplier to the customer. This template is slightly geared to the interests of the customer. In the basic form, a general purchasing agreement provides the key parameters for the suppliership:
- The nature, as general purchasing agreement (basic), as a framework for the supply, not-applicability of general terms and conditions.
- The rules that apply to submitting and accepting purchase orders, the delivery, any required product inspections from the supplier, which Incoterm applies and clarifying when the risk (or ownership) of the products pass to the customer.
- A force majeure clause (here: customer-friendly) addressing any temporary impracticability of delivery.
- An arrangement on the pricing of the products or services (and optional clauses dealing with possible future price increases).
- A basic payment clause (payment term, taxes).
- Warranties in relation to the products and services (and what happens in certain cases or if an end-customer or consumer must be able to invoke such warranty.
- A straightforward arrangement for duration with termination rights.
- The common miscellaneous (boilerplate) clauses.
Note that this model General purchasing agreement basic is a starting point only. If certain clauses are superfluous in the relevant context, they might be deleted. Conversely, the specific context may likely require the insertion of tailored provisions addressing risks or circumstances related to the relevant product, service or context of supply. In certain countries, specific clauses may be desirable or needed. Also a list with the products to be supplied under this general purchasing agreement basic must be added.