Document background
The Preferred Supplier Agreement is a fundamental commercial document used when an organization wishes to establish a long-term, preferential relationship with a key supplier while maintaining flexibility in purchase volumes. This agreement, governed by Hong Kong law, provides a framework for recurring purchases while securing preferential terms, pricing, and service levels. It is particularly useful for organizations with regular procurement needs who want to streamline their purchasing process and secure favorable terms without committing to fixed purchase volumes. The document typically includes detailed provisions on ordering procedures, quality standards, performance metrics, and risk allocation, all aligned with Hong Kong legal requirements and commercial practices. It serves as a master agreement under which individual purchase orders can be placed, reducing the need for repeated contract negotiations.
