About vendor agreements and types

Vendor agreements are created within the Purchase Order application, and also from contracts in the Contract Management application. Agreements provide the cost of an item for purchase orders (and requisitions). The five types of vendor agreements are:

• Contract - contains the item cost information agreed upon between you and the vendor

• Catalog/Quote - contains a list of available items and their costs as offered for sale by the vendor. Considered as a non-binding price list.

• Blanket - contains a list of suggested items, letting you pick and choose which items you want to order and when

• Standing - contains fixed items and quantities for supplies that you order often

• Service - acts as an ongoing agreement between you and a service provider, containing the cost of the service and dates when the agreement is valid. Services can include things such as building or electrical repair, and so on.

In order to create vendor agreements from contracts, you must have already set up vendor groups, item groups, and the General Ledger company. When you add a contract to become a vendor agreement, you enter additional information, such as agreement reference and buyers.

In Contract Management, vendor agreements are tied to a procurement group, so that they can be used by more than one company. Procurement groups let you set up options for creating purchase orders in the Purchase Order application.

Contracts and vendor agreements differ from each other in several ways. First of all, contracts created in Contract Management cannot be changed in the Purchase Order application. Conversely, vendor agreements created in Purchase Order cannot be viewed (or changed) in Contract Management. However, Contract Management creates vendor agreements in the Purchase Order application when you activate a contract.