SITXMGT002 Establish and conduct business relationships

Assessment Task 2 – Project (Part C) Making formal agreements

1. Present the outcomes from each negotiation to your supervisor/manager or trainer and discuss the
viability of each term negotiated according to your notes. Enter the outcomes for each contractual
detail you have negotiated in the table below and indicate the changes required (if any) and/or the
approval to proceed with the agreements.

Approved Not Recommended Change

Supplier 1 Approved
Contractual detail 1: 10% discount
x 8% discount and 10% for over
off and a further discount if buy over
Contractual detail 2: Contingency
x
plan
Contractual detail 3: Return policy
x
Contractual detail 4: payment terms
x
Contractual detail 5: delivery costs
x
Supervisor Name: Lan
Supervisor Signature: Lan
Date: 14/09/2021

Approved Not Recommended Change

Supplier 2 Approved
Contractual detail 1: have
x
permission to use any resources
from Tas Tour
Contractual detail 2: cancellation
x
policy
Contractual detail 3: increase the
x 10% commission up to 1000
commission to 15%
hours. 15% commission for over
1000 sold per annum
Contractual detail 4staff famils
x
Contractual detail 5: waitlist
x
conditions
Supervisor Name: Lan
Supervisor Signature: Lan
Date: 14/09/2021

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 2. Based on the feedback from your supervisor or trainer, contact the supplier and negotiate the final
changes if required. Record the negotiated changes in the table and obtain final approval from your
supervisor or trainer.

Supplier 1 Details negotiated Outcome approved not

approved
10% discount off and a further discount if buy They said too much x
over discount. They can only
accept 8% discount off and if
buy over $1 million will get
10% discount off
Contingency plan: NHS would ensure products x
of the same high quality delivered for the same
cash from supplier-NHS will pay the difference.
If they can not supply, they will give 15%
discount. Drysdale Hotel order monthly on a
Wednesday-NHS will deliver by the third
Wednesday in the month
Return policy: within 48 hours from delivery x
will pick free of change- replace within 7 days
payment terms: Drysdale will pay $300 x
thousand up front as credit- then pay monthly
invoice once deposit. Payment is after 30 days
Drysdale will pay NHS a further 5%
delivery costs: free delivery cost to Drysdale x
Hotel
Supplier 2 Details negotiated Outcome
Drysdale Hotel has permission to use any x
resources from Tas Tour
Cancellation policy: 2 hours minimum notice if x
weather dependent-after replacement hour
with a 10% discount. If not, 100% refund
Increase the commission to 15% 10% commission up to 1000 x
hours. 15% commission for
over 1000 sold per annum
Staff famils: Tas Tour will supply a variety of 2 x
hours per month for staff in Drysdale Hotel
Waitlist conditions: Drysdale customers will be x
offered if any cancellation as a priority from
the waitlist

3. Contact each supplier by email and confirm the agreements made. Advise each party that you will
finalise the formal agreements for signing of all parties.
1) Hello Pia,
Thanks for meeting me last time. We are really glad to cooperate with you this time. According
to the contracts in our meeting, I need to confirm something with you.
1.You will give us 8% discount off and if we buy over $1 million, we will get 10% discount off. You
would ensure products of the same high quality delivered for the same cash from supplier, if

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 not, you will pay the difference. If you can not supply, you will give us 15% discount. We will
order monthly on a Wednesday and you will deliver by the third Wednesday in the month.
2. Within 48 hours from delivery you will pick free of change and you will replace within 7 days.
3. We will pay $300 thousand up front as credit, then pay monthly invoice once deposit. When
payment is after 30 days we will pay NHS a further 5%.
4. We will pay for the delivery fee.
Here is our terms and conditions. If you have any questions, please send me an email any time.
If not, we will make the contract and you can tell us about the time to sign the agreements. We
are looking forwards to your reply and hope you have a great day.
Regards,
Drysdale Hotel
2) Hello Pia,
Thanks for meeting me last time. We are really glad to cooperate with you again. According to
the contracts in our meeting, I need to confirm something with you.
1. Drysdale Hotel has permission to use any resources from Tas Tour
2. 2 hours minimum notice if weather dependent. If after replacement hour with a 10%
discount. If not, 100% refund.
3. 10% commission up to 1000 hours. 15% commission for over 1000 sold per annum
4. Staff famils: Tas Tour will supply a variety of 2 hours per month for staff in Drysdale Hotel
5. Waitlist conditions: Drysdale customers will be offered if any cancellation as a priority from
the waitlist
Here is our terms and conditions. If you have any questions, please send me an email any time.
If not, we will make the contract and you can tell us about the time to sign the agreements. We
are looking forwards to your reply and hope you have a great day.
Regards,
Drysdale Hotel

4. Draw up the contract agreements based on your final negotiated outcomes. Each contract must
contain the following details:

You are encouraged to identify legal requirements based on your own research or legal advice. The
following websites provide basic information thereto:
https://www.smallbusiness.wa.gov.au/business-topics/money-tax-and-legal/legal-matters/business-
contracts/#verbal

https://www.business.qld.gov.au/business/starting/starting-a-business/working-business-
advisers/types-business-advisers

 Names of contracting parties including trading names and ABN/ACN, as well as their contact
details

 supply conditions, including volume, price, discounts, ordering periods, take or pay and delivery
times
 payment terms
 specifications of goods or services supplied (scope of goods)
 warranty periods for defective goods or services

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  limited liability (risk of loss or damage)
 intellectual property
 confidentiality
 insurance
 dispute resolution
 termination and exclusion clauses
 signature provisions

5. Present your final contracts to your supervisor and trainer for final approval

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