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Preferred Supplier Contract

Preferred Supplier Contract Template for India

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Key Requirements PROMPT example:

Preferred Supplier Contract

I need a Preferred Supplier Contract for an automotive parts manufacturer in Chennai, India, who will be our exclusive supplier for the next 3 years starting January 2025, with minimum purchase commitments of 10,000 units per quarter and preferential pricing terms.

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Document background
The Preferred Supplier Contract is designed for businesses operating in India who wish to establish a formal, long-term relationship with key suppliers. This document is particularly valuable when a company seeks to secure reliable supply chains, preferential pricing, and guaranteed service levels from strategic vendors. It includes comprehensive terms covering supply obligations, performance standards, and commercial arrangements, while ensuring compliance with Indian contract law and commercial regulations. The agreement is commonly used in industries requiring regular, high-volume purchases or specialized supplies, and can be customized to address industry-specific requirements and compliance obligations.
Suggested Sections

1. Parties: Identification of the supplier and customer, including registered addresses and company details

2. Background: Context of the agreement and the intention to establish a preferred supplier relationship

3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement

4. Appointment and Scope: Formal appointment of preferred supplier status and scope of supplies covered

5. Term and Renewal: Duration of the agreement and renewal provisions

6. Ordering Process: Procedures for placing and accepting orders, including minimum order quantities if applicable

7. Delivery and Performance: Requirements for delivery, acceptance, and performance standards

8. Price and Payment: Pricing structure, payment terms, and invoicing requirements

9. Quality Requirements: Quality standards, specifications, and quality control procedures

10. Warranties and Representations: Warranties regarding products/services and general business warranties

11. Liability and Indemnity: Allocation of risks and responsibilities between parties

12. Termination: Grounds for termination and consequences of termination

13. Confidentiality: Protection of confidential information exchanged during the relationship

14. Governing Law and Jurisdiction: Applicable law and jurisdiction for dispute resolution

15. General Provisions: Standard boilerplate clauses including notices, amendments, and severability

Optional Sections

1. Exclusivity: Terms of exclusive supply arrangement, used when supplier is granted exclusive rights

2. Volume Commitments: Minimum purchase obligations, used when specific volume commitments are agreed

3. Performance Metrics: Detailed KPIs and service levels, used for complex supply arrangements

4. Innovation and Development: Terms for product/service development and improvement, used in technology or innovation-focused relationships

5. Compliance Requirements: Industry-specific compliance obligations, used when supplying regulated industries

6. Insurance Requirements: Specific insurance obligations, used for high-risk supplies or services

7. Business Continuity: Business continuity and disaster recovery requirements, used for critical supplies

8. Environmental Requirements: Environmental standards and compliance, used for environmentally sensitive supplies

9. Data Protection: Data protection and privacy obligations, used when personal data is processed

Suggested Schedules

1. Products and Services: Detailed list of products/services covered under the agreement

2. Pricing Schedule: Detailed pricing structure, including any volume discounts or pricing mechanisms

3. Service Levels: Detailed service level requirements and measurement criteria

4. Technical Specifications: Detailed technical specifications for products or services

5. Key Personnel: List of key personnel from both parties responsible for contract management

6. Approved Locations: List of approved manufacturing or service delivery locations

7. Quality Standards: Detailed quality standards, testing procedures, and acceptance criteria

8. Forms and Templates: Standard forms for purchase orders, change requests, and reports

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Linkedin in social icon imageX social icon image
alex.den.21@genieai.co
Relevant legal definitions
Agreement
Applicable Law
Approved Location
Business Day
Commencement Date
Confidential Information
Contract Year
Customer
Delivery Location
Delivery Terms
Force Majeure Event
Good Industry Practice
Goods
GST
Initial Term
Intellectual Property Rights
Key Performance Indicators
Minimum Order Quantity
Order
Preferred Supplier Status
Price
Products
Purchase Order
Quality Standards
Related Party
Renewal Term
Representatives
Schedule
Services
Service Levels
Specifications
Supplier
Supply Terms
Term
Territory
Third Party
Working Hours
Warranty Period
Clauses
Appointment and Status
Term and Duration
Exclusivity
Supply Obligations
Ordering Process
Delivery
Title and Risk
Quality Control
Price and Payment
Volume Commitments
Performance Standards
Service Levels
Warranties
Compliance
Audit Rights
Insurance
Liability
Indemnification
Intellectual Property
Confidentiality
Data Protection
Force Majeure
Change Control
Termination
Exit Management
Anti-corruption
Assignment and Subcontracting
Notices
Dispute Resolution
Governing Law
Entire Agreement
Severability
Waiver
Variation
Third Party Rights
Counterparts
Business Continuity
Environmental Compliance
Health and Safety
Labor and Employment
Product Recall
Reporting Requirements
Relevant Industries

Manufacturing

Automotive

Information Technology

Healthcare

Retail

Construction

Electronics

Pharmaceuticals

Fast-Moving Consumer Goods

Industrial Equipment

Telecommunications

Energy and Utilities

Relevant Teams

Procurement

Supply Chain

Legal

Operations

Finance

Compliance

Quality Assurance

Vendor Management

Commercial

Risk Management

Relevant Roles

Procurement Manager

Supply Chain Director

Commercial Director

Vendor Management Lead

Category Manager

Chief Procurement Officer

Sourcing Manager

Contract Manager

Supply Chain Analyst

Operations Manager

Legal Counsel

Compliance Officer

Industries
Indian Contract Act, 1872: Fundamental law governing contract formation, validity, performance, and enforcement in India. Covers essential elements like offer, acceptance, consideration, and breach of contract.
Sale of Goods Act, 1930: Regulates the sale and purchase of goods, including conditions and warranties, transfer of property, delivery of goods, and remedies for breach of contract.
Competition Act, 2002: Ensures that preferred supplier arrangements don't create anti-competitive effects or abuse of dominant position in the market.
Central Goods and Services Tax Act, 2017: Governs the taxation aspects of supply of goods and services, including registration, payment, and compliance requirements.
Indian Stamp Act, 1899: Mandates stamp duty requirements for different types of commercial agreements to make them legally admissible.
Arbitration and Conciliation Act, 1996: Provides framework for dispute resolution through arbitration and conciliation, essential for including dispute resolution clauses.
Information Technology Act, 2000: Relevant for electronic contracts and digital signatures if the agreement is executed electronically.
Foreign Exchange Management Act, 1999: Applicable if the preferred supplier arrangement involves international parties or cross-border transactions.
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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