Building Materials Contract and Agreement Summary

What a good one includes

• A clear breakdown of price adjustment and escalation clauses, highlighting how and when a supplier can raise material costs due to market volatility.
• A precise definition of delivery terms and risk of loss transfers, explaining exactly when ownership and liability for damage shift from the seller to the buyer.
• A simplified schedule of payment terms, including early payment discounts, credit limits, and late payment penalties or interest rates.
• A summary of the manufacturer warranty flow-throughs and the exact dispute resolution steps required if materials arrive damaged or non-conforming.
• A clear explanation of the termination and order cancellation policies, outlining any restocking fees or non-refundable deposit terms.
• A breakdown of the force majeure and supply chain delay provisions, detailing who bears the financial burden during unexpected material shortages.

Common mistakes to avoid

• Overlooking the difference between FOB Shipping Point and FOB Destination, which can leave you financially responsible for materials damaged during transit.
• Ignoring hidden price escalation clauses that allow suppliers to increase costs between the order date and the actual delivery date without your prior approval.
• Failing to identify the strict time windows allowed for inspecting delivered materials and reporting defects, which can void your right to a refund or replacement.
• Assuming standard verbal promises or email agreements from sales reps supersede the written terms in the final signed contract.

Frequently asked questions