Once a supplier is found to associate with your company, you need to initiate contract signing process to safe guard your company’s interest.
Signing of NDA ( Non-Disclosure Agreement) : prevents them from sharing any of the confidential information , product design, drawings etc. with third parties. Supplier need to return all confidential documents they have once the contracts are terminated from either side. Also it protects the Patent & IP rights of the buyer. Only permitted disclosures are those asked by the government or tax authorities.
QAA( Quality Assurance Agreement ) : will hold the supplier to maintain the quality standards agreed for the product. QAA to be signed by the supplier. Quality target is accepted product specifications & functionality as per technical drawing. To achieve this, supplier to have the necessary quality systems standard, machine & process capabilities, reviews by the buyer, Inspections by the third party & product release process are mentioned in this contract.
General Commercial Terms & Conditions : will specify all other terms like pricing, Delivery, Delays in Delivery, Penalty for late delivery, Product Quality & safety, Liability for defects & malperformance, Product Liability Insurance, Samples Development & Testing, Tooling Development & Ownership, Third Parties Intellectual property rights, Copy Right, Sub contractors involvement, Social Compliance, Confidentiality etc.
Social Code of Conduct Agreement : This is to be signed by the supplier. It mentions terms like legal compliance, Freedom of Association & collective bargaining by the workers, Fair compensation, Working Hours, Work Place health & safety, Prohibition of Discrimination, Forced labour, Child labour etc., Bribery & corruption, Environment & safety Issues, management Systems, Consequences of Non-compliance, Grievance Procedure etc.
