Long lead time components and cancelling purchase orders - clause library
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Long lead time components and cancelling purchase orders – clause library

Long lead time components may frustrate or disproportionally complicate cancellation of a purchase order prior to the product’s delivery. A clause addressing compensation for components ordered before cancellation may meet both customer’s and supplier’s interests.

The clause provides for a mechanism to smoothen the effects of cancellation (or allows for such cancellation) by providing that the customer shares in its adverse consequences.


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