Supply contracts

LOGISTICS -> Supply contracts

Supply contracts provide the information needed to manage and pay for the produce that you sell. Every carton is assessed when it comes into stock to find a Supply contract.

In snapSales, supply contracts are not intended to be actual individual contracts with your suppliers. Rather, they are a way of setting up a group of suppliers that you deal with on the same basis (ie a supply channel).

Factors that may prompt you to set up a separate supply contract include:

• Suppliers on a contract are paid on the same basis: pooled; consignment; or fixed price.
  • If pooled, the same set of pools apply to all suppliers on the contract. For example, you may want different supply contracts for North Island and South Island if you run separate pools for those areas.
  • If paying fixed prices then the pricing schedule is defined against the supply contract.
• Payment adjustments and advance rates can be entered against the supply contract. snapSales can target these at specific suppliers within a contract. However, you may wish to set up separate contracts if there are significant differences.

Tip

Setting up one supply contract per packer is often a good way to start.

Setting up

Adding a supply contract

• Description - Identifies the contract.
• Payment basis - Options include:
  • Pooled: Suppliers in the same pool with all receive the same rate of return after all sales in that pool have been finalised. See Pools for more information.
  • Consignment: Suppliers will be paid their share of individual sale returns after costs and charges (eg commission) have been deducted.
  • Fixed price: Suppliers will be paid a pre-agreed fixed price for their produce irrespective of the sales return.
  • Purchased:
• Advance delay
• Fixed commission
• Notes - Any comments you wish to record against this contract.
• Active? - controls whether this contract will be allocated against any further inventory.
• Applies to (filters) - filters the inventory that will be matched against this contract. You may choose only to permit produce from a particular packer or orchard.
• Priority - if inventory matches more than one contract then the contract with the lowest priority number will be selected. This allows you to have default contracts that will catch all product not allocated to a more specific contract that has a lower priority number.

Note

Leaving an Applies to filter blank means that no filtering will occur on that attribute. For example if you leave the Growing method filter blank then any growing method will match.

Once you've saved your supply contract you are ready to start adding more details...

Pay To (who should be paid)

This is a schedule of who should be paid for produce supplied under this contract.

• Pay to - This is the SETUP -> Vendor who will be paid. Normally this is the grower.
• Applies to (filters) - Filter the inventory that will be paid to this vendor. Often this is filtered for one or more orchards but other filters are also available.
• Priority - If inventory matches more than one SETUP -> Vendor then the SETUP -> Vendor with the lowest priority number will be paid. This allows you to redirect payments to another SETUP -> Vendor in special circumstances.

Pay Rates

This is a schedule of rates that will be paid for produce supplied under this contract.

• Description - for your own purposes.
• In stock rate - this rate will be paid for matching product while it is in stock. Once the product is sold, this advance will be reversed and potentially replaced by one of the following sold rates.
• Sold advance rate - for Consignment and Fixed Price contracts, this rate will picked up and used in the sale Pay To section. This rate does not apply to Pool contracts which have their own advance rate set (see SETUP -> Pools)
• Sold final rate - for Fixed Price contracts, this rate will picked up and used in the Sale Pay To section. This rate does not apply to other contracts.

Note

Note: In stock advances require the supporting stock information from your suppliers.

Adjustments

Payment adjustments are special rebates or deductions. These occur after the return for the supplier's produce has been calculated.

• Description - Describe the adjustment as it will appear on the supplier's payment.
• GL account - Select the GL account that these adjustments will be coded to on BCIs.
• Invoice or statement - Choose where this adjustment should appear on grower invoices (affects the BCI return), or just on their statement. An example of a statement adjustment may be an assignment where a portion of the growers return is redirected to a third party (eg the packer).
• Timing - Advances or Final only.
• Rate - The rate used to calculate the adjustment.
• Per - The UOM used to determine the quantity used for the adjustment. Options include:
  • Kgs, TCEs - as described;
  • % FOB - allows for the cost to be a percentage of the sale's FOB return in local currency (NZD).
• Applies to (filters) - provide a means to filter the inventory that will contribute to this adjustment's quantity.

Pools

Select the pools that may be applied to produce on this contract. This section will appear if you have selected Pooled as the contract's Payment basis.

See SETUP -> Pools for more information.

Reassess product already in stock

When product arrives in stock, every carton is checked to see which supply contract it falls into, checking contracts with lowest priority first, comparing the Applies to criteria to see if the carton is valid.

Use the Reassess product already in stock function when you need to change the supply contract or pool for product, ie in cases where product has not found a supply contract, or fallen into the wrong supply contract/pool.

• The FAST way - this will only reassess product that has not been assigned to a supply contract or pool yet.
• The SLOW way - this will reassess all product in store. If you wish to use this option, it is advisable to restrict the product you reassess by entering some Applies to criteria so you don't reassess product that doesn't need reassessing. Depending on the filters you apply, this option can take some time to complete.