What should be included in a Sales Agreement?
A Sales Agreement contract should include the following elements if it is a Sales Purchase Agreement (SPA):
- Terms - what the goods are and in what quantities
- Purchase Price - how much the buyer shall pay the seller and in what currency.
- Delivery - when goods need to be delivered by and in what state
- Risk of loss - who bears the cost and risk if the goods are faulty
- Acceptance - how long the buyer has to accept the goods upon receipt and give notification of any faults.
- Warranty and warranty of title - the seller claims that all goods are free from defect, but what is to be done if they are found to be faulty. Seller also confirms that they have the full right and title to sell the goods.
- Governing law and venue - what country’s law the agreement is governed by
- Force Majeure - what occurs in the case of a Force Majeure event
There is another type of Sales Agreement template, however, that we have available in our library: the Commercial Sales of Goods template and the long version of International Sale of Goods. We have included these extra following elements in this contract to ensure that it is both reliable and useful in protecting both parties’ legal interests.
- Documents - The relevant documents needed to support the sale
- Non performance of the buyer’s obligation to pay the price at the agreed time - What happens if the buyer does not pay at the correct time
- Non performance of the seller’s obligation to pay the price at the agreed time - What happens if the seller does not deliver the goods at the agreed time.
- Lack of conformity - Once the buyer has accepted and examined the goods, they have a number of days to alert the seller to any issues. What those issues can be are listed.
- Avoidance of contract - How any breach of contract will be dealt with or resolved.
- Final, common agreement clauses - These include entire agreement, notices, dispute resolution procedure, applicable law and guiding principles
When should I use a Sales Agreement?
Either type of Sales Agreement should be used when two parties are entering into a contract to buy or sell goods - on a commercial basis or otherwise. Drafting and executing a Sales Agreement (sometimes referred to as a Purchase and Sales Agreement) is essential to ensure that all parties have their legal interests supported. An obvious Sales and Purchase Agreement example would be in the case of a real estate transaction. However, there are countless other instances where they are used as so many business relationships are founded on the basis of buying and selling goods.
Why should I use a Sales Agreement?
You should use a Sales Agreement as having such a contract in place eliminates any chance of misunderstanding or confusion occurring. What is left is a highly effective transactional relationship. That’s down to defining the terms and conditions that surround the buying and selling of goods. Both sides know what they have to do for the transaction to go ahead. As a result, there is far less likely a chance of any legal dispute in the future as both sides will know what is required of them to uphold the agreement.
Where and how should I use a Sales Agreement template?
Sales Agreement templates should be used in any instance where a Sales Agreement is required. While it is possible to draw up a contract from scratch, using a template has many advantages. Firstly, it speeds the entire process up. However, it also ensures that all crucial elements have been included and users of a template can therefore have confidence that their resulting contract is a usable, legal document. Finally, if you require many different Sales Agreements, templates are a fantastic tool as they take out much of the administrative burden. Thanks to being in a dynamic data format, our contracts can help automate the entire procedure so that contracts have all relevant information included - without the hassle of having to manually change it all.