1.0 Roles and Responsibilities
Buyer - defines purchase requirements and places orders for goods and services.
Seller - supplies goods or services in accordance with purchase requirements.
2.0 Acknowledgment - Seller shall acknowledge receipt of purchase order. Seller's acknowledgment signifies agreement to fully comply with purchase requirements. Seller shall assess no other charges upon Buyer, other than those defined on the acknowledgment. Purchase requirements include, but are not limited to specifications and drawings, item or part numbers, order quantities, transportation methods, packaging instructions, delivery dates and delivery locations. Acknowledgment shall be made in writing to Buyer within two (2) business days. If acknowledgments are not received, Buyer shall assume that Seller fully complies with purchase requirements.
3.0 Changes - Buyer has the right to make changes at any time to purchase requirements. Changes shall be formally communicated in writing to Seller. Seller shall acknowledge changes in same manner as purchase order. If acknowledgment of change is not received from Seller within two (2) business days, Buyer shall assume that Seller fully complies with changes to purchase requirements. Changes to manufacturing process or end-item configuration requested by Seller must be submitted to Buyer for approval. All changes shall be approved by Buyer prior to Seller's implementation.
4.0 Identification - Seller must ensure that all shipping containers are labeled in a conspicuous location on the outside of each container. All nomenclature shall be written in English language. Label information shall include at a minimum, Buyer's purchase order number, item number, description and quantity per container. Skids (pallets) containing packaged containers of Buyer's goods, shall have a master skid sheet affixed to the skid in a conspicuous location. Skid sheets shall contain at a minimum, Buyer's purchase order number, item number, description, quantity of boxes per skid and bulk quantity of items per skid.
5.0 Delivery - Seller shall coordinate delivery of goods in accordance with dates defined in the purchase requirements. Deliveries received five (5) days early through zero (0) days late (-5d/+0d receiving tolerance) shall be considered on-time. Seller shall include usual and customary transportation times to ensure compliance with Buyer's purchase requirements.
5.1 Non-compliant Deliveries - If deliveries to Buyer are not received in accordance with the delivery requirements, Buyer shall have the right to exercise one of the following options:
a) Reject and return to Seller at Seller's expense.
b) Accept and store goods delivered early and charge storage fees to Seller.
c) Invoice Seller for charges incurred by Buyer associated business impact due to late delivery. Charges shall include, but are not limited to costs associated with lost opportunity such as resource utilization costs, expedited freight to deliver late product to Buyer's customer and administrative fees. Buyer reserves the right to cancel, at no cost to Buyer, balance of undelivered order if Seller's promised delivery date is not met. No charges shall be assessed to the supplier if Buyer finds that Seller was not the root cause of delivery non-conformance. Examples are force majeure, raw material market supply shortage, etc.
6.0 Order Fulfillment - Seller, in all cases, shall deliver full quantities, unless otherwise granted in writing by Buyer. Buyer reserves the right to inspect goods upon receipt. Seller shall ensure that items are manufactured in accordance with applicable drawings and specifications and delivered in a "ready to use" condition per the purchase requirements. If goods or services are deemed nonconforming, Buyer shall:
a) Return to Seller for rework or replacement at Seller's expense.
b) Rework in accordance with a rework plan developed by Buyer and communicated to Seller. Seller shall be invoiced for charges associated with Buyer's rework costs.
7.0 Documentation - Seller shall list at a minimum Buyer's part number, purchase order number, quantity and unit of measure on all invoices and shipping documentation.
8.0 Confidentiality and Intellectual Property - Seller shall agree to protect and treat as confidential all information furnished by Buyer and shall not disclose to any third party. Seller shall agree to hold Buyer harmless against patent infringements and other legal considerations related to the manufacture, use or sale of the goods or services covered by Buyer's purchase requirements. Seller shall agree to hold Buyer harmless against any and all losses, liabilities, claims, damages, suits and other legal considerations, including all associated costs, related to Buyer's purchase requirements.