An agreement is a contract between the buyer and the supplier or subcontractor. An agreement defines all the requirements that the supplier or the subcontractor needs to meet during the course of the agreement.
You create an agreement after evaluating the bids from different suppliers and identifying the supplier whom you want to award the contract. The following diagram shows when agreements come into the picture in the material management process.
Depending on your requirements, you might need to create different types of agreements. Agreements can be broadly classified into two groups: orders, and subcontracts.
|
Type |
Details and examples |
|---|---|
|
Order |
An order can be different types, like blanket order, field order, change order, rental order, notice of commitment, manual order, or purchase order. |
|
Subcontract |
A subcontract can be rental order, field order, service agreement, subcontract, or work order. |
Every agreement has an agreement number that uniquely identifies that agreement. An agreement also has various sections like vendor details, delivery details, financial details, and so on.
Depending on your role, you might need to view and edit the entire agreement or some part of the agreement. After an agreement is created and reviewed, it needs to be approved by somebody with the required authority. Depending on the workflow configuration, approvals can be a single step or a multi-step process. For multi-step approvals, after the approval is sent from each approver, a final approval needs to be performed from the buyer organization. After the approval process is complete, you issue the agreement to the supplier.
View Manage Agreements for more information on agreements.