Contract trade explained

Contract trade

In the floriculture sector, a lot of work is performed based on contracts. You can record long-term agreements in Floriday, using the "contract trade" functionality. Contract trade refers to long-term agreements made with a grower. These types of agreements become customer-specific supply lines in Floriday, which both the grower and the buyer can call on. All agreements made under contract trade are subject to a purchase obligation.

How does it work?

While both growers and buyers have the option to create a contract, this will always have to be approved by the other party. The contract establishes the following specifications:

  • Product(s)
  • Specifications such as loading
  • Contract period
  • Delivery terms and conditions
  • Contract schedule
  • The schedule consists of weeks. For each week, you enter:
    - Number of items to be purchased
    - Price per item
    - Minimum and maximum purchase margin

During the term of the contract, it can be amended at any time in consultation between the grower and buyer. Both parties must agree to the amendment. If an agreement is not reached, the contract rules previously established apply.

Difference between a fixed agreement and a contract

As a buyer, you can either make a standing agreement, or conclude a contract with a grower. These are two different options for making agreements. The major difference between a standing agreement and a contract is that a contract includes a purchase obligation. This purchase obligation does not apply to a standing agreement. In addition, a contract is more extensive than a standing agreement.


When do you make a standing agreement and when do you conclude a contract?

1. The standing agreement: As a buyer, if you have weekly agreements with growers, you should create a standing agreement for this. Standing agreements become customer-specific supply lines in Floriday. Buyers can order based on this as long as the agreement remains valid. Standing agreements do not appear on the weekly lists.

2. A contract: As a buyer, if you wish to make a long-term agreement with the grower, a contract can use used for this purpose. The contract:

  • Can be concluded by both the grower and the buyer.
  • Both the grower and the buyer have the option to call on the contract.
  • Once the contract has been drawn up, it must be approved by the other party and the contract can be called on.

Floriday's role in contracts

Floriday only facilitates the option to create, amend and establish standing agreements and contracts. For queries on drafting contracts or contract compliance issues, please contact an account manager or your contact at Royal FloraHolland.
The establishment of the contract is only visible to the grower and the buyer drawing up the contract. The dates in the contract is not accessible to third parties, not even Royal FloraHolland. In short, the agreements between a grower and a buyer remains between the grower and buyer. This information only finds its way into the Royal FloraHolland databases once a transaction has taken place.


More information

  • The first buyers and growers are currently testing this functionality. Following the testing phase, this functionality will become available to everyone. Keep an eye on our communication channels.
  • If you like more information or have any questions, please contact a Floriday expert at support@floriday.io or call 0174-352070

Need help?

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