Think Twice Before Using These Contractual Shortcuts To Address Supply Chain Challenges

All producers are typically bored with listening to about provide chain issues. These days firms are on the lookout for methods to mitigate transport delays (i.e., can we ship to a port aside from Lengthy Seashore?) and the elevated value for uncooked supplies.

Apparently, I’m beginning to see shopper product firms and business-to-business producers use related language to handle these points.

Client Product Instance for Delivery Delays:

“We are currently experiencing a high volume of orders and shipping may be delayed as a result.”

B2B Producer Instance for Delivery Delays:

“All existing valid quotations may be subject to additional lead time.”

B2B producers are additionally coping with the volatility in the price and availability of uncooked supplies. Consequently, some firms are including language like this to their contracts and phrases and situations of sale:

“Due to the volatility in the price and availability of raw materials, Manufacturer reserves the right to pass along subsequent price increases and surcharges from our vendors without further notification.” 

Our Response:

As manufacturing business legal professionals, we perceive the target of including such language. If you’re contemplating including such language, it’s best to maintain two issues in thoughts:  (1) take into account whether or not the additions are literally consistent with fundamental tenets of contract legislation (i.e., are you including extra phrases after the contract was accepted by the client?); (2) take into account the optics of telling all of your clients in normal language that you could be be late. For these causes, producers ought to take into account managing these points on a case-by-case foundation – with help from authorized counsel, as wanted.

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