Supply Agreement

A business-to-business framework agreement for the regular supply of goods. The parties agree the commercial terms once – specification, prices, ordering, lead times, delivery, quality, payment, liability and termination – and the buyer then places individual orders, each of which becomes a separate contract on these terms.

• A manufacturer, wholesaler or producer supplying a trade customer on a repeat basis
• A business buying components, raw materials, packaging or stock from a regular supplier
• Where you want certainty about prices, lead times and quality over a period, without committing to buy fixed quantities (or, using the option in clause 2, with a minimum commitment)

• Decide whether you are drafting as the supplier or the buyer – the template is balanced, but the guidance notes highlight where each side may want to push
• Complete the Goods and Specification (Schedule 1), Prices (Schedule 2) and Ordering and Delivery details (Schedule 3)
• Choose the retention of title option in clause 7 and the liability cap in clause 13
• Use the order form in Schedule 4, or make sure the buyer’s purchase order system captures the same information