Vendor / Supplier Agreement
A Vendor Agreement governs the relationship with your suppliers — defining product specifications, delivery schedules, payment terms, warranty obligations, and what happens if deliveries fail. Essential for any business with regular procurement dependencies.
What is Vendor / Supplier Agreement?
A Vendor Agreement (or Supplier Agreement) is a contract between a buyer and a supplier that governs the ongoing supply of goods or services. It is broader than a purchase order, providing the legal framework for the relationship rather than just a single transaction. In India, vendor agreements are governed by the Indian Contract Act, 1872, and for goods, the Sale of Goods Act, 1930. A well-drafted vendor agreement protects against non-delivery, quality failures, price escalation, and supply disruptions.
What you get
- Customised Vendor / Supplier Agreement
- Product specifications and quality standards
- Delivery schedule and penalties for delay
- Payment terms and credit period
- Warranty and defect liability
- Price revision mechanism
- Audit and inspection rights
- Force majeure and supply disruption
- Termination for cause and convenience
- Word + PDF format
Documents required
- Buyer and vendor entity names and GST numbers
- Description of goods or services to be supplied
- Volume, frequency, and delivery terms (ex-works, CIF, etc.)
- Unit price and payment terms
- Quality standards or specifications document
- Warranty period and return policy
- Any exclusivity or minimum purchase commitments
How it works
Share Procurement Details
Provide details of the goods/services, parties, payment terms, quality standards, and any specific concerns.
Lawyer Drafts
We draft a vendor agreement that protects your interests on delivery, quality, payment, and termination.
Negotiate Terms
Circulate to the vendor for review and assist with negotiating specific clauses.
Execute & Operationalise
Both parties execute the agreement. Individual purchase orders issued under the agreement reference its terms.
Pricing on Request
Every situation is different — get a custom quote tailored to your exact needs.
Frequently asked questions
Is a purchase order sufficient, or do I need a vendor agreement?
A purchase order covers a single transaction. A vendor agreement provides the overarching legal framework — quality standards, warranty, audit rights, force majeure, and termination — for an ongoing supply relationship. For any vendor supplying critical materials or services, a full agreement is essential.
What GST implications should the vendor agreement address?
The agreement should specify whether prices are exclusive or inclusive of GST, who bears the GST, the HSN/SAC code applicable, invoicing requirements (tax invoice format), and the buyer's ability to claim ITC. Incorrect GST treatment in the agreement can create disputes and ITC disallowance.
How should delivery terms be specified?
Use standard Incoterms (Ex Works, FOB, CIF, DDP) for clarity on who bears delivery costs and risk of loss. For domestic supply, specify the delivery point, packaging standards, and documentation required (e-way bill, delivery challan).
What should the warranty clause cover?
The warranty clause should specify: warranty period, what defects are covered, vendor's obligations on receipt of a defect claim (repair, replace, or credit), return logistics, and exclusions (damage caused by buyer's misuse). For manufactured goods, a 12-month warranty from delivery is standard.
Can I include a price lock or escalation cap?
Yes. For long-term supply agreements, we typically include a price lock period followed by a CPI-linked or negotiated escalation mechanism. This protects you from arbitrary price increases while giving the vendor some protection against cost inflation.
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