Companies selling goods often rely on vendors, particularly when dealing with high volumes. This can be a beneficial relationship for all parties, with vendors selling their goods in high volumes to businesses that mark the goods up for a profit.
All business relationships should be founded on watertight contracts, and relationships with vendors are no exception. Here’s what a vendor contract should include.
The scope of the goods
Firstly, a vendor contract should clearly outline the scope of the goods to be delivered. For instance, the contract should include accurate product descriptions, volumes and brands. The purpose of outlining the scope of the goods is to avoid any confusion and disputes over the type of products included in the arrangement.
Delivery methods and times
Purchasers should know precisely when they are to receive their goods. This allows the company to take a stock inventory and stay organized. This is also important for the vendor as they will know exactly what their delivery obligations are.
Price and payment method
The vendor contract should also identify the price of the products and how they are to be paid for. For instance, will the vendor accept cash, credit card payments, checks or partial payments?
Bringing the deal to an end
Few business relationships last forever, and a business may find a new vendor with more competitive prices. In these circumstances, the business needs to know how it can bring the arrangement to an end legally. A vendor contract can include terms related to the termination of the business relationship. For example, whether or not there are any extra fees for bringing the deal to an end early.
Vendor contracts are just one of several legal areas your business needs to be aware of. When dealing with such issues, it can benefit you to have legal guidance on your side.