When you reorder argan oil every two or three months, the cost of one-off orders starts to show: renegotiating each time, uneven lead times, and the risk that the next batch differs from the last. An annual supply agreement, often called a blanket order, fixes the framework with your manufacturer and leaves the detail of each shipment to an agreed call-off schedule.
Poorly written, though, it can tie up your capital or commit you to volumes you cannot sell. This guide covers what to include, when it fits, and how to negotiate without over-committing.
What is an annual supply agreement?
It is an agreement on an estimated total volume over twelve months, delivered in instalments. Specifications, pricing method and payment terms are negotiated once, then shipments repeat inside the same framework. Three elements should be kept distinct:
- Firm volume: the minimum you commit to buy.
- Non-binding forecast: what you expect to need, updated regularly.
- Call-offs: the dates and sizes of actual shipments.
When it fits, and when it does not
| Your situation | Best option |
|---|---|
| Established product with steady sales for several months | Annual agreement with a firm minimum and monthly or quarterly call-offs |
| New brand, untested market | Pilot batch, then separate orders |
| Seasonal sales (Ramadan, holidays, summer) | Uneven schedule concentrated before the season |
| Distributor with irregular orders | Framework agreement with a modest minimum and flexible timing |
Clauses to settle
- Reference specification: grade (cosmetic or culinary), a document attached to the contract, and a certificate of analysis for each batch.
- Minimum and maximum volume, with a delivery tolerance.
- Call-off schedule and required notice.
- Price mechanism: fixed or reviewable, and on what basis. Prices vary with grade, volume, season and exchange rates, so ask for a written quotation with its validity period.
- Currency and payment terms, including who bears exchange risk.
- Storage at the factory: duration, conditions and remaining shelf life at delivery.
- Batch consistency: a signed reference sample and agreed comparison criteria.
- Rejection and replacement: inspection window and procedure.
- Force majeure and harvest variability: argan is an agricultural product.
- Termination and renewal.
Consistency matters more than price
The main benefit is not a lower price but oil with similar characteristics in every shipment. Slight differences in colour or scent are natural, so attach a reference sample and agree what you will check: lab analysis, sensory review and appearance. Disputes then get settled against a written standard rather than an impression.
How to negotiate without over-committing
- Calculate real demand from actual sales, not hoped-for targets.
- Split the commitment: firm below your forecast, non-binding above it.
- Ask for a realistic schedule that allows for production and shipping time.
- Write down the specifications before discussing price.
- Build in a quarterly forecast review.
- Have the legal terms reviewed (governing law, dispute resolution).
Common mistakes
- Committing to the full volume before testing the market.
- Leaving specifications scattered across messages.
- Ignoring remaining shelf life when calls are delayed.
- Not stating who pays for extended storage.
FAQ
Am I obliged to buy the full volume?
Not necessarily. It depends on the wording: the minimum can be firm and the rest indicative, as long as it is stated clearly.
Is the price fixed for the whole year?
It can be fixed or reviewed under a defined mechanism. Specify duration, currency and method in writing.
What if my sales drop mid-year?
Include a review clause and a reasonable minimum, and discuss in advance how a call-off can be postponed or reduced.
Should I run a pilot batch first?
Yes, for a new product. See our article on the pilot batch versus production batch.
If you plan regular argan oil supply, we would be glad to discuss volumes, specifications and a call-off schedule with you. See how we work on our process page, and read about manufacturing lead times before fixing dates. To start, request a quote at assilouargane.com/quote.
