Contract pricing is a practice used to reduce and control costs.
With Contract Pricing, we take your core items and place them on a written contract with assigned and negotiated prices and inventory levels. Prices will remain frozen for the agreed period of time.
Within this model, there are various benefits that the customer can experience:
Fixed costs that allow you and your company to plan your product pricing while controlling cost
Delivery and availability systems that match our inventory levels with your purchases with twenty to twenty-five percent of your estimated annual usage kept on hand at our location for immediate release if necessary
Supplier capability from a vendor capable of handling your needs
A pre-expediting system that enables you to be aware, in advance, of any delivery problems should they arise
Service and time savings by placing products on a commitment
Competitive costs are created through consolidation of your requirements into higher purchases with selected vendors
Benefits exist when considering distribution as well:
Allows us to improve our inventory and stock control through know customer needs
We become more familiar with your products, company and your specific needs
The development of a close and open mutually beneficial relationship
The key to an effective program is to offer a win-win arrangement for all parties involved. An arrangement that will strengthen our customers, distributor and manufactures relationships.