What is the management of the contract?
Term Contract Administration is usually used in the Public Procurement or Purchase Departments. Within the obligations of the Ministry of Public Procurement, the manager negotiates, accepts and signed contracts with the suppliers of the goods and services by the organization. Administration of contracts is the process of ensuring that the supplier distinguished its negotiated terms and conditions. Although the role of public procurement in the negotiation process is an essential part of the cost management process, the management of the contracts is where the actual savings are reached or missed. Contract Administration involves ensuring compliance with the contract, acting as a primary contact concerning the problems related to services and dispute resolution, as well as the management of any payments or the provisions of the agreed in the contract. Generally, three main areas can be divided: Prague, discounts and power clauses.
The threshold is a term used to define specific dollar expenditure, purchased transactions or purchased units. These thresholds are the obvYKle tied to discounts on the dollar from the purchase price and are often based on the number of orders received in a certain period of time. As part of the negotiation process, Prague is often used to require even deeper discounts than the supplier would normally provide. As the volume increases, the supplier has the motivation and the ability to reduce the price, as its costs decrease.
discounts are used as a reward or motivation to the supplier to meet specific goals. For example, a bakery can negotiate to buy a specific amount of flour over the period of time. Any other, unplanned applications that are completed in a certain period of time are eligible for the supplier's discount. The opening is for the standard amount, but the discount is calculated and returned to the supplier as a remuneration for meeting immediate need. This flexibility often occurs in time -sensitive environments where there is a contract for the standard delivery plan but forFurther flexibility is required.
performance clauses are based on measurable items that are critical for business activities. Normal provisions are based on delivery within a certain time frame, invoicing within the specified extent of the date, fulfilling the deadlines for the provision of benchmarks and the percentage of completion of construction projects. The purpose of the performance clause is to set up the acceptance of the measurement method between the supplier and the customer. These provisions are often tied to fines or rewards, depending on industry.
Effective contract management involves everyday activity monitoring, performance management and subsequent monitoring with the supplier. Only through an active MProcess anagement contract, the company can require any benefits included in the contract. These benefits may include premature release provisions, further reduction in payments and other sanctions.