Making a Logistics Services Contract

Over 80% of customers report that the outcome of their logistics contract deviates from their expectations when they selected the provider and signed a contract. The costs and the loss of customers can be huge and career-damaging.

Logistics has the nature of requiring flexible and complicated service on which the success of the customer depends. Protecting the commitments and objectives made is essential, but at the same time your agreement needs to allow for both minor deviations that are in scope and big changes that are not and that require an evolution in the terms of your contract. All this is a specialised undertaking that we have learned to manage.

When signing a deal, both parties need to understand their commitments and risks.

We help you with a good contract that deals with:

Warehousing:

  • the general objectives of the collaboration
  • the basic assumptions on which the collaboration is built.
  • the set-up and performance of the IT systems
  • the performance of automation
  • a clear description of the goods and their handling and storage requirements
  • the handling of deviations in the quantities and work content
  • the responsibilty in case of handling damages and stock differences
  • the insurance in case of fire, burglary or other major incidents
  • the Key Performance Indicators that need to be achieved
  • the penalties when KPI are not achieved
  • the responsibilty for customer complaints
  • the responsibility for consequential damages
  • the possibility to end or transfer the operation
  • the rate-card or other pricing mechanism
  • the handling of inflation and depreciations
  • force majeure
  • others

Transport

  • the general objectives of the collaboration
  • the basic assumptions on which the collaboration is built.
  • the set-up of the IT systems and the follow-up of the deliveries
  • a clear description of the goods and their handling and storage requirements
  • the handling of deviations in the quantities and customer requirements
  • the responsibilty in case of handling damages and losses (CMR payout or other)
  • the Key Performance Indicators that need to be achieved
  • the penalties when KPI are not achieved
  • the responsibility for consequential damages
  • the responsibilty for customer complaints
  • the possibility to end or transfer the operation
  • the rate card or other pricing mechanisms
  • the fuel cost fluctuation
  • the handling of inflation
  • force majeure
  • others

The objectives of reaching the agreed budget and performance are not easy to obtain