After selecting suppliers, the buyer negotiates the final order, listing the technical specifications, the quantity needed, the delivery schedule, and so on. In the case of MRO items, buyers are moving toward blanket contracts rather than periodic purchase orders. A blanket contract establishes a long-term relationship in which the supplier promises to resupply the buyer as needed at agreed-upon prices over a specified period. Because the seller holds the stock, blanket contracts are sometimes called stockless purchase plans. The buyer's computer automatically sends an order to the seller when stock is needed, and the supplier arranges delivery and billing according to the blanket contract.
Blanket contracting leads to more single-source buying and ordering of more items from that single source. This system locks suppliers in tighter with the buyer and makes it difficult for out-suppliers to break in unless the buyer becomes dissatisfied with the in-supplier's prices, quality, or service.
Was this article helpful?
As with any web site, SaleHoo has a number of features that will help you in buying products from around the world. Once you have an account on SaleHoo, which only costs a one-time fee, you can establish up to twenty named searches for products. After that, any time those items become available, you’ll be alerted.