PRODUCTION AND INVENTORY Clause Samples
The 'Production and Inventory' clause defines the obligations and procedures related to the manufacturing and storage of goods under the agreement. It typically outlines how much product must be produced, how inventory levels are to be maintained, and may specify requirements for forecasting, reporting, or minimum/maximum stock levels. For example, it might require the supplier to keep a certain amount of finished goods on hand to meet anticipated demand or to notify the buyer of any production delays. This clause ensures that both parties have clear expectations regarding product availability, helping to prevent supply shortages or overstock situations.
PRODUCTION AND INVENTORY. (a) On the date of execution and delivery of this Agreement by Cott, and on or prior to October 15 of each subsequent calendar year of the term, Cott shall provide Crown with a non-binding forecast of requirements by Designated Location for the next calendar year. Crown acknowledges that any forecast provided by Cott is a good faith estimate only, and is not a commitment on the part of any Buyer to purchase any quantity of Products.
(b) In addition to the annual forecast described above, Cott shall provide Crown on a monthly basis with a 3-month non-binding rolling forecast of requirements by Designated Location. Crown acknowledges that any forecast provided by Cott is a good faith estimate only, and is not a commitment on the part of any Buyer to purchase any quantity of Products. After receipt of the 3-month rolling forecast, Crown’s production group will be responsible to conduct monthly calls, with the appropriate Crown and Cott designees, to work in a collaborative partnership to review and take corrective actions to resolve the issues identified by the team with the intent of continuously improving forecast efficiencies for both the Cott Group and Crown Group.
(c) Supplier shall provide to Buyer a detailed inventory report (including in-transit inventory) every month by the seventh (7th) day after the end of each month for the prior month for each warehouse and manufacturing location. *** Indicates a portion of the exhibit has been omitted based on a request for confidential treatment submitted to the Securities and Exchange Commission. The omitted portions have been filed separately with the Commission.
(i) Buyers will submit release schedules weekly from the Designated Locations to Supplier’s plants by Thursday at noon for the following week. Any subsequent changes to these schedules by Buyers with less than [***] notice (“Rush Changes”) will be on [***], will require approval at Crown [***], and, subject to the following, will be subject to an incremental “rush” up charge of [***] per Rush Change.
(ii) The parties will mutually agree upon an [***], provided that [***].
(iii) Rush up charges will be aggregated and invoiced in six month increments (each, a “Charge Period”). If Buyers do not incur any rush up charges during any Charge Period immediately following a Charge Period where a rush up charge applied, [***].
(iv) Both parties agree to assign personnel to start and manage the process, and review Rush Change Limits on an annual basis.
(i) Buye...
PRODUCTION AND INVENTORY. (a) Buyer shall provide Supplier on a monthly basis with a 3-month rolling forecast of requirements by Designated Location. The Supplier acknowledges that any forecast provided by Buyer is a good faith estimate only, and is not a commitment on the part of Buyer or any other member of the Buyer Group [***] to purchase any quantity of Products.
(b) Supplier shall supply each Designated Location from its closest applicable manufacturing location(s), however if the closest Supplier manufacturing location is more than 500 miles from a Designated Location or if the manufacturing location is across a body of water, Supplier and Buyer will jointly determine a list of SKUs and min/max inventory levels of at least thirty (30) days supply for each SKU to store and ship from a local warehouse to be maintained by Supplier at its cost within 50 miles from the relevant Designated Location.
(c) Whenever the inventory level of any SKU reaches or falls below the pre-determined inventory amount equivalent of at least thirty (30) days supply, Supplier will replenish its local warehouse to the pre-determined levels within five (5) business days. The same procedure will apply on inventory of ends. The only exceptions to this program will be special order and/or cans intended for export out of the country in which such cans have been filled, which will be produced within 48 hours written notice and delivered within 96 hours if required by Buyer.
(d) Supplier shall provide to Buyer a detailed inventory report (including in-transit inventory) every month by the seventh (7th) day after the end of each month for the prior month for each warehouse and manufacturing location.
(e) Buyer shall fax its releases of requirements for each Designated Location for the following week (quantity by SKU) no later than Thursday noon. Releases will be in full truckload quantities with date/time required to arrive at the Designated Location.
(f) Supplier shall assign an employee to review inventory levels and forecasts with Buyer on a monthly basis, to assure optimum levels are kept and to avoid any slow movers and obsolescence.
(g) Prior to every shipment, Supplier will inspect all cans and ends prior to shipment to or pick up by Buyer to ensure they arrive at the Designated Locations free of damage (but even if any such inspection(s) disclose no damage Supplier shall nonetheless be responsible in accordance with this Agreement for any damage that occurs prior to risk of loss shifting to Buyer).
(h...
PRODUCTION AND INVENTORY. 1. Supplier shall maintain its production and inventory of finished products for sale to ALDI in quantities not to exceed a one (1) month supply of ALDI’s normal orders and requirements and not more than three (3) months’ supply of labels and packaging.
2. Supplier shall have an annual inspection performed for all facilities used to manufacture, or pack product sold to ALDI with GFSI certification or equivalent. All facilities used to store product sold to ALDI must have an annual inspection and obtain a GMP certification or equivalent. Fresh produce Supplier shall instead have completed GAP (for growers) and GMP (for growers and distributors). All national produce suppliers must have GFSI inspection reports for all facilities used to process or store product sold to ALDI performed annually. A copy of the applicable inspection report shall be sent electronically to ALDI within ten (10) days of receipt by Supplier with Supplier’s written action plan for making corrections or changes outlined in the report.
3. Supplier agrees to allow persons authorized by ALDI to inspect, upon reasonable notice, any facility used for products sold to ALDI, including but not limited to third-party warehouses and storage facilities.
4. Notwithstanding the previous provisions, ALDI reserves the right to refuse to accept product from any third-party warehouse or storage facility at any time for any reason. Should ALDI exercise this right, Supplier shall indemnify, defend, and hold ALDI and its agents and employees harmless, from and against any allegation, claim or lawsuit brought by a third-party warehouse or storage facility.
5. At ALDI’s discretion, Supplier shall have its product tested at Supplier’s expense for compliance with ALDI’s specifications by an outside laboratory approved by ALDI, and Supplier shall furnish ALDI with all test results.
6. All products sold by Supplier to ALDI shall be properly packaged in order to assure safe delivery. Supplier shall label the outer shipping case for products sold to ALDI with item description, item code and units per case. Individual cases shall not be shrink wrapped.