Many things can go wrong with a purchase order. You and the supplier should be on the same terms on what action should be taken and on doing this there are fewer chances of taking the issue to court. Make sure that you think of every situation possible and how you and the other party plan to deal with it. List it down under the terms and conditions of the purchase order.
Here is a checklist of things that should form apart of your purchase order.
- Backorder or a delay- The contract should mention if the buyer can delay payments or the seller be forced a refund in case the payments is needed upfront. Also whether the business can cancel the order in case he does not get the goods at the time requested.
- Nonpayments are also something that should be discussed. Can the supplier seize the goods that have been delivered or can he refuse the delivery of any future shipments? Is the supplier ready to give some time before taking the case to court?
- If the term of the contract is broken can the parties give time to fix the issue? Can the party cancel the order in case of a breach of contract? And does the seller have the right to amend the contract to only include a part of the good?
- The laws over which the contract will be governed should be clear. This varies based on the countries and the jurisdiction and you need to know the laws that apply when you enter into an agreement with another party. You can include or eliminate some laws at the start of the contract. If the parties are in different countries then if you are unfamiliar with the laws then it could lead to you facing litigation.
To not get sued on your purchase order make sure that you know the laws followed by the last mile logistics.