An urgent component requirement needs to be purchased to meet the timescales of a project. A supplier proposes using its standard terms and conditions. What risk to the buying organisation could this bring?
A.
A breach of competition laws
B.
Contract conditions that are favourable to the buyer
C.
A breach of the supplier's internal financial controls
D.
Contract conditions that are favourable to the supplier
Supplier standard terms and conditions are drafted:
To protect the supplier’s interests,
To limit the supplier’s liability,
To secure favourable payment and performance conditions for the supplier.
If the buying organisation accepts these without negotiation (especially in a rush), it risks ending up with contract conditions that are favourable to the supplier (D) and less favourable protections for itself.
[Reference: CIPS L4M3 Commercial Contracting – Battle of the forms and risks of accepting supplier-drafted terms., , ]
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