Module 3 · Chapter 6

Minimum Purchase Targets: When the Distributor Misses One

Distributors often agree to buy a set number of goods each year. This chapter shows why that target is not a duty to buy, and what the supplier may do when it is missed.

≈ 7 min read 8-question test

In this chapter

  • Why the Agreement sets a target, not a duty to buy
  • What Cressby may do when Tullavane misses a target, and by when
  • What changes once Tullavane loses its exclusivity

6.1Minimum purchase targets in one paragraph

The Agreement gives each year a Minimum Purchase Target: the number of machines Tullavane should buy from Cressby in the year. It is a goal, not a promise to buy, so a shortfall breaks nothing. Instead, Cressby may take away the exclusivity. After two missed years in a row, it may terminate.

Key point

A missed target is not a breach. Its only results are the ones clause 5.3 sets out.

Also in this chapter

  1. A target, not a duty to buy
  2. What Cressby may do when a target is missed
  3. The missed target in Year 1
  4. Your job

Preview

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