Under Indian Contract Act, 1872 a vendor agreement is an agreement, which specifies the conditions under which the work is to be completed/done by the vendor/seller. It is a wide-ranging agreement which comprises numerous features such as the quality of goods supplied or service provided, duration of the contract, terms and modes of payment or it includes restrictions on every work of the vendors. Such agreements are mainly required for those vendors who use to have business on large scale.
As a marketplace Portal, you need basically a contract that is called vendor agreement to tie up with vendors and get on marketplace portal so in the vendor agreement all the terms and conditions with pay-out policies and the terms of service & lot of other legal things are mentioned or illustrated. Basically, most of the start-ups in the initial phase, choose a good lawyer to draft the vendor agreement but it became really very expensive for the start-ups to do. So they end up making a vendor agreement following the trend.
Depending upon the type of industry, the following elements are central to the drafting of vendor agreements
Exact elucidation of the services and goods should be the part of the condensed clause.
One of the important clauses is the price at which the products will be given to the vendee. The price can be either fixed or variable. Or it can change with the requirement of time and need.
The vendor agreement must clearly stipulate the time and frequency terms of the contract.
The vendor agreement should also prescribe penalties or interests charged for delayed payments. The mode of payment needs to be mentioned as well.
The problems concerning damaged or defective good, delayed payments should be addressed effectively.
A termination manner or an exit option unilaterally or bilaterally should form the basis of any agreement according to the requirement.
The whole concept of work product ownership between parties to the contract and it needs to be previously decided by way of including a clear clause for it.
The obligation to not disclose any material information to the third party or non- stakeholders should find a mention.
After contract gathered from the client it takes approx. 2 working days to deliver the contract. If any modification required it takes another time required to modify such.