GUIDE · 03 / 8

Purchase orders

Price · quantities · term · payment · delivery · incorporated terms

WHAT IT IS

The transactional document confirming what your customer is buying: what, how much, when and at what price.

WHEN IT COMES INTO PLAY

With every sale, often under an existing MSA, and sometimes issued by the customer's procurement system.

WHY IT MATTERS

The purchase order looks mundane, but it's often what sets the actual price, term and commitments. It also incorporates, sometimes quietly, general terms that can contradict the negotiated contract. A few minutes of checking keeps a two-page document from undoing weeks of negotiation.

WHAT IT OFTEN CONTAINS

Description of products or services

What is ordered, in what quantity and at what service level.

Price, taxes and discounts

Unit price, applicable taxes and discounts granted, with their duration.

Term and start date

Start date, commitment term and renewal terms.

Payment terms

Payment deadline, currency, late interest and billing method.

Reference to general terms

The reference to the general terms or master agreement governing the order.

WHAT OFTEN GETS NEGOTIATED

Payment deadlines

WHAT THE BUYER OFTEN ASKS FOR

Payment terms of 60 to 90 days.

SUPPLIER SIDE

30 days, with late interest and a right to suspend after prolonged default.

Minimum commitments

WHAT THE BUYER OFTEN ASKS FOR

No minimum commitment, to keep full flexibility.

SUPPLIER SIDE

A minimum volume or term in exchange for the discounts granted.

Cancellation fees

WHAT THE BUYER OFTEN ASKS FOR

Free cancellation up to the last minute.

SUPPLIER SIDE

Cancellation fees covering costs already incurred.

SAMPLE CLAUSE

APPLICABLE TERMS

« This purchase order is governed exclusively by the Agreement between the parties. Any term appearing in a Customer purchase order, procurement portal or any other document is of no effect. »

IN PLAIN TERMSWhatever the customer's procurement system says, your negotiated contract is what applies.

BEFORE YOU SIGN

Do price and term match the deal?

Are the customer's terms expressly excluded?

Is the payment deadline acceptable?

Do discounts come with something in return?

Is the reference to the master agreement accurate?

FREE

Personalized negotiation playbook

Share a link to your own contract: we turn it into a starter playbook with opening and fallback positions on the key points. Delivered by email.

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