Common use of Purchase Management Clause in Contracts

Purchase Management. To define the rights and obligations of respective parties and in the spirit of mutual benefit and friendly cooperation, the two parties enter into this Agreement. I. Definition of “purchase” under this Agreement: “Purchase” under this Agreement refers to the transaction under which Party A places a Purchase Order with Party B, Party B produces according to Party A’s processing drawings, technical indices, quality standards, acceptance standards and other requirements and delivers the goods to the place designated by Party A, and then Party A, after conducting acceptance inspection, pays Party B for the goods according to the unit price set out in the Purchase Order and the quantity of goods it actually receives. II. Determination of unit purchase price 2.1 Party B shall, in the spirit of honesty, provide a true cost analysis form and put forward reasonable profit requirements. On this basis, Party A and Party B shall determine the final unit purchase price. 2.2 Party B shall promptly adjust the unit price for goods supplied to Party A according to the changes in the market prices of raw materials or changes in production techniques and other cost factors. In case of any price change, the Purchase Order placed before adjustment shall be executed as per the original price and the Purcahse Order placed after adjustment shall be executed as per the new price. If Party B offers a price lower than Party A’s other suppliers of the same type of raw materials, Party A shall have the obligation to give more orders to Party B; and if Party B offers a higher price, Party A shall have the right to reduce the orders to Party B and even cancel its supply qualifications. 2.3 If Party A has any doubt about Party B’s cost analysis form, Party A shall have the right to conduct an on-the-spot investigation to learn about Party B’s cost structure, and Party B shall have the obligation to provide information about cost factors as reasonably required by Party A. 2.4 Party A and Party B shall keep relevant cost information and unit transaction price in confidence and shall not disclose them to any third party for any reason (unless otherwise stipulated by the law).