Procurement Glossary
Delivery Schedule Agreement: Framework agreement for on-time deliveries
November 19, 2025
A Delivery Schedule Agreement is a strategic framework agreement between buyers and suppliers that regulates flexible delivery dates and quantities over a longer period of time. This agreement enables companies to manage their procurement in line with demand and at the same time create planning security for both contracting parties. Find out below what a Delivery Schedule Agreement is, how it is implemented and what advantages it offers for modern procurement.
Key Facts
- Framework agreement with flexible call-off quantities and dates over 12-36 months
- Reduces storage costs by up to 30% thanks to on-demand deliveries
- Enables short-term volume adjustments in the event of fluctuations in demand
- Creates planning security for suppliers with guaranteed minimum purchases
- Integrates seamlessly into modern ERP systems and supply chain management
Contents
Definition and importance of Delivery Schedule Agreements
A Delivery Schedule Agreement defines the contractual framework for staggered deliveries between procurement organizations and suppliers.
Basic contract components
The agreement comprises several central components that enable structured delivery processing. The agreement specifies minimum and maximum quantities, defines delivery rhythms and determines lead times for call-offs.
- Framework quantities and price scales over the contract term
- Flexible call-off modalities with defined lead times
- Quality standards and delivery conditions
- Escalation mechanisms in the event of delivery deviations
Delivery Schedule Agreement vs. traditional ordering process
In contrast to individual orders, the agreement offers continuous supply relationships with reduced transaction costs. While traditional procurement reacts reactively to requirements, the agreement enables proactive inventory control through delivery schedules.
Importance in modern Procurement
Delivery Schedule Agreements support lean management principles and just-in-time strategies. They reduce working capital through optimized inventories and create transparency in the supply chain through structured communication processes with suppliers.
Process, control and planning
The successful implementation of a Delivery Schedule Agreement requires systematic planning and continuous control of the delivery processes.
Contract design and implementation
The implementation process begins with the supplier evaluation and negotiation of the framework conditions. Critical success factors are the definition of service level agreements and integration into existing procurement systems.
- Supplier qualification and capacity assessment
- Negotiation of price scales and volume discounts
- Definition of quality standards and delivery conditions
- Integration into ERP systems and ordering processes
Operational control and monitoring
Ongoing control takes place via regular demand forecasts and call-off planning. Modern systems enable automated order triggering based on stock levels and consumption patterns. Kanban systems support demand-oriented control.
Performance management and optimization
Continuous performance measurement using KPIs such as delivery reliability and quality rates enables proactive improvements. Regular supplier reviews and contract adjustments ensure the long-term effectiveness of the agreement.
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Operational key figures for Delivery Schedule Agreements
Systematic performance measurement using relevant KPIs enables the continuous optimization of Delivery Schedule Agreements and their value contribution.
Delivery performance and adherence to delivery dates
Delivery reliability measures the proportion of on-time deliveries and is the most important indicator of the reliability of the agreement. The On-Time Delivery Rate (OTDR) should be at least 95%, while the Perfect Order Rate evaluates quality, quantity and deadline combined.
- On-time delivery rate (OTDR) in percent
- Perfect Order Rate (POR) for overall performance
- Average delivery deviation in days
- Emergency deliveries and rush orders per quarter
Cost efficiency and working capital
Cost-per-order is reduced by 40-60% through framework agreements compared to individual orders. Inventory Turnover Rate shows the efficiency of inventory management, while Days Sales Outstanding measures capital commitment.
Quality and compliance key figures
Defect rate and first-pass yield continuously measure delivery quality. Supplier scorecard evaluations integrate performance data and support strategic supplier decisions. Carrier Performance supplements the evaluation with logistical aspects.
Delivery and control risks with delivery schedule agreements
Delivery Schedule Agreements involve specific risks that must be minimized through systematic risk management and preventive measures.
Supplier dependency and default risks
Long-term agreements can lead to critical dependencies on individual suppliers. Supplier failures due to insolvency or capacity bottlenecks jeopardize security of supply and can cause production stoppages.
- Single-source risks for critical materials
- Financial instability of suppliers
- Capacity bottlenecks during peak demand
- Quality problems with long-term agreements
Market and price risks
Fixed price agreements over longer periods of time can lead to competitive disadvantages in volatile commodity markets. Currency fluctuations with international suppliers further increase cost risks.
Operational management risks
Inadequate demand forecasts lead to over- or understocking with corresponding cost consequences. Poor system integration between buyer and supplier can cause communication errors and delivery deviations. Delivery performance monitoring helps to identify risks at an early stage.
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Practical example
An automotive supplier implements a Delivery Schedule Agreement for electronic components with a semiconductor manufacturer. The agreement covers a term of 24 months with monthly call-offs based on rolling 12-week forecasts. The supplier guarantees delivery times of a maximum of 14 days for standard components and 28 days for customer-specific variants. Automated EDI interfaces are used to trigger orders directly from the ERP system if stock levels fall below defined minimum quantities.
- Reduction of storage costs by 35% through demand-oriented deliveries
- Improvement in delivery reliability from 87% to 96% within 6 months
- Reduce transaction costs by 50% through automated processes
Current developments and effects
Digital transformation and artificial intelligence are revolutionizing the design and management of delivery schedule agreements in modern procurement.
Digitization and automation
Cloud-based platforms enable real-time transparency between buyers and suppliers. Automated demand forecasts through machine learning optimize call-off quantities and reduce bullwhip effects in the supply chain.
- IoT integration for automatic stock notifications
- Blockchain technology for transparent supply chains
- Predictive analytics for precise demand forecasts
AI-supported optimization
Artificial intelligence analyses historical consumption data and external factors to optimize delivery rhythms. AI algorithms identify patterns in fluctuations in demand and automatically adapt delivery schedules to market changes.
Sustainability and ESG integration
Modern agreements integrate sustainability criteria and CO2 footprint optimization. Suppliers are increasingly evaluated according to ESG criteria, and transport optimization reduces environmental impacts through consolidated deliveries.
Conclusion
Delivery Schedule Agreements are essential tools for modern, agile procurement strategies. They combine planning reliability with operational flexibility and enable significant cost savings through optimized stock levels. Successful implementation requires systematic supplier evaluation, robust system integration and continuous performance monitoring. Digital technologies and AI-supported optimization will further increase the effectiveness of these agreements.
FAQ
What is the difference between a Delivery Schedule Agreement and a framework agreement?
A delivery schedule agreement is a special form of framework agreement with a focus on staggered deliveries. While framework agreements primarily specify conditions, the agreement defines specific delivery rhythms, call-off modalities and inventory control. It integrates operational planning processes directly into the contract design.
How is the optimum contract term determined?
The contract term is based on product life cycles, market volatility and supplier capacities. Typical terms are 12-36 months, with stable markets allowing longer periods. Volatile industries prefer shorter terms with extension options. Regular reviews every 6-12 months ensure flexibility in the event of market changes.
Which systems support operational implementation?
ERP systems such as SAP or Oracle offer integrated modules for schedule agreements. EDI interfaces automate data exchange with suppliers, while supply chain planning tools optimize demand forecasts. Cloud-based platforms enable real-time transparency and collaborative planning between all parties involved.
How are quantity deviations and plan changes handled?
Agreements define tolerance ranges for quantity deviations, typically ±10-20% of the planned call-off quantity. Short-term changes require defined lead times, while structural adjustments trigger contract modifications. Escalation processes regulate communication in the event of critical deviations and ensure that solutions are found quickly.
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