Supply Contract

15 October 2010

A supply contract is, as the name suggests, a legal document for the providing of goods or services from one company to another.  Because this is a legal document, most are reviewed by lawyers to make sure it abides by the current laws.

To construct a supply contract does not require a lawyer, as many suspect. Anyone is capable of constructing one if they know what to include. To help those that are planning on venturing this path, there is help. In many of the project management template sets, there is one made specifically for this purpose.

With the template to guide the user, a supply contract can be properly constructed to include all the necessary items and legal information. This is made possible by the real life examples most programs of this nature have with them. There are also step by step instructions to help guide the user in this vitally important task.

What should be kept in the mind of the person creating the supply contact at all times is the focus and purpose of this formal document. This is an agreement between two companies for one of them to supply the other with a service or product at a specified time, in a specified quantity and quality, and at a specific price.

For some businesses, they use the supply contract as a reward to a third party vendor when a discounted price on a particular item is granted. In many cases, the discounted price will include an order larger than what is required so the third party vendor can still make a descent profit while still supplying the goods or services at a reduced rate.

Once all of this is said and done, the supply contract has to be reviewed and approved by both sides of the agreement. This is generally where the lawyers step in. This allows for the best possible review of the document without making the price of creating it and approving it over the budget.