Framework agreement
An agreement setting the general terms applicable to an ongoing commercial relationship — pricing, payment terms, warranties, delivery conditions — without creating a firm purchase obligation. Individual orders placed later reference the framework agreement.
In practice
A framework agreement secures the commercial relationship without creating binding purchase commitments. It is particularly useful in franchisor-network supplier relationships: the franchisor negotiates conditions at network level using consolidated volume, while individual franchisees place orders within that framework. Duration is typically one to three years with an annual price renegotiation clause. Price revision clauses — indexation, raw material linkage — deserve close attention to prevent imbalances during inflationary shocks.