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Supply Agreement
I need a supply agreement for a local supplier providing raw materials on a monthly basis, with terms including a 30-day payment period, quality assurance standards, and a clause for renegotiation of prices every six months.
What is a Supply Agreement?
A Supply Agreement sets out the terms between companies buying and selling goods in Singapore, laying down exactly how products will be delivered, paid for, and handled over time. It covers essential details like pricing, delivery schedules, quality standards, and what happens if something goes wrong.
These contracts play a key role under Singapore's Sale of Goods Act, helping businesses protect themselves while building reliable supply chains. Good agreements spell out important safeguards like product warranties, confidentiality rules, and ways to handle disputes - making them vital tools for both suppliers and buyers in manufacturing, retail, and other commercial sectors.
When should you use a Supply Agreement?
Use a Supply Agreement when establishing any ongoing business relationship involving regular product deliveries in Singapore. This is especially important for manufacturing components, raw materials, or retail inventory where consistent supply directly impacts your operations. The agreement becomes crucial when dealing with high-value goods, specialized products, or when your business depends heavily on timely deliveries.
Put this agreement in place before starting large-scale orders or when switching to new suppliers. It's particularly valuable in regulated industries like food, pharmaceuticals, or electronics, where quality standards must meet strict requirements. Having clear terms from the start helps avoid costly disputes and supply chain disruptions later.
What are the different types of Supply Agreement?
- Manufacturing And Supply Agreement: Comprehensive contract for custom-manufactured goods, including production specifications and quality control
- Agreement For Labour Supply: Focuses on temporary workforce provision, covering worker qualifications and employment terms
- Supply Contract Agreement: Standard template for regular product delivery, ideal for ongoing business relationships
- Contract To Supply Goods: Simplified agreement for one-off or short-term product supply arrangements
- Supply Contract: Basic framework for routine product supply, easily adaptable for different industries
Who should typically use a Supply Agreement?
- Manufacturers and Suppliers: Companies providing goods, raw materials, or components under Supply Agreements, responsible for meeting quality standards and delivery schedules
- Purchasing Companies: Businesses buying products or materials, often represented by procurement teams who negotiate terms and monitor compliance
- Legal Counsel: In-house or external lawyers who draft, review, and customize agreements to protect their clients' interests
- Quality Control Teams: Staff responsible for inspecting deliveries and ensuring compliance with product specifications
- Finance Departments: Handle payments, track costs, and manage financial obligations outlined in the agreement
How do you write a Supply Agreement?
- Basic Details: Gather company information, registration numbers, and authorized signatories from both parties
- Product Specifications: Document exact descriptions, quantities, quality standards, and packaging requirements
- Delivery Terms: Define delivery schedules, locations, transportation methods, and handling requirements
- Payment Structure: Outline pricing, payment terms, currency, and any volume-based discounts
- Risk Management: Consider insurance requirements, warranties, and liability limits under Singapore law
- Performance Metrics: Set clear KPIs, quality control procedures, and reporting requirements
- Template Selection: Use our platform's intelligent document generator to create a legally-sound agreement tailored to your needs
What should be included in a Supply Agreement?
- Party Details: Full legal names, registration numbers, and authorized representatives of both supplier and buyer
- Product Terms: Detailed specifications, quantities, quality standards, and packaging requirements
- Delivery Conditions: Timelines, locations, Incoterms, and acceptance procedures
- Payment Terms: Pricing, payment schedules, invoicing requirements, and late payment consequences
- Term and Termination: Contract duration, renewal options, and termination rights
- Force Majeure: Circumstances excusing non-performance under Singapore law
- Dispute Resolution: Choice of Singapore law, jurisdiction, and arbitration procedures
- Confidentiality: Protection of trade secrets and business information
What's the difference between a Supply Agreement and a Supply of Services Agreement?
A Supply Agreement differs significantly from a Supply of Services Agreement in several key aspects under Singapore law. While both involve commercial relationships, they serve distinct purposes and require different legal considerations.
- Subject Matter: Supply Agreements focus on tangible goods, products, and materials with specific quality standards and delivery requirements. Services agreements deal with intangible deliverables like consulting, maintenance, or professional expertise
- Performance Metrics: Goods supply typically measures success through product specifications and delivery timing. Service agreements often use KPIs, service levels, and qualitative benchmarks
- Risk Allocation: Product defects, shipping delays, and inventory management are central to Supply Agreements. Service agreements focus on professional liability, personnel qualifications, and service quality
- Legal Framework: Supply Agreements fall under Singapore's Sale of Goods Act, while service agreements are governed primarily by contract law and industry-specific regulations
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