When interviewing procurement manager, the writer realizes that procurement department is facing with lots of problems including late delivery of equipment, poor quality of equipment, wr
PROBLEM IDENTIFICATION
Company background
The Vietnamese full name: Korea National Oil Corporation- VPĐH tại Vietnam
The English name: Korea National Oil Corporation - Vietnam office
Address: 10 th Floor, Diamond Plaza, 34 Le Duan Street, District 1, HCM city, Vietnam
KNOC Vietnam Office (KNOC VN) began operations in Block 11-2 after signing a production-sharing contract (PSC) in May 1992 After confirming gas reserves through three exploratory wells, KNOC VN secured a stable sales channel by signing a tentative gas sales agreement with Petro Vietnam in December 2004 The company then concluded a construction contract and issued a construction order, marking the start of full development of the block.
As the sole operator, KNOC VN carries out exploration, development, and production activities in Block 11-2, approximately 320 kilometers offshore Vietnam
KNOC VN holds 75% of participating interest in this block on behalf of the Korean Consortium which consists of LG International Corp., Daesung Industrial Com., Daewoo International Corp., Hyundai Corp., Samwhan Corp., and Seoul City Gas Co Ltd PetroVietnam Exploration and Production Company (PVEP) holds the remaining 25% of the interest in the block
Production began on December 25, 2006 The average daily production of natural gas from the seven production wells in the block reaches 171 million standard cubic feet The block’s recoverable volume is 770 billion standard cubic feet Production will continue until 2024 Total reserves are 770 billion cubic feet Daily production is 108 million cubic feet Production period is from 2007 to 2024 (17 years)
KNOC VN achieved a landmark as its first overseas operating project with successful production in the Rong Doi and Rong Doi Tay fields, marking a milestone for both the company and Korea’s oil and gas industry KNOC VN employees were involved in all phases—from exploration and development to production—participating in important negotiations, drilling, reserve estimation, and the engineering and construction of offshore facilities.
Number of employees: 164 Departments: 4 (Admin & Finance, Operations, Drilling, Sub-Surface) Procurement Team belongs to Operations Department
Procurement team has five members (one Procurement Manager and one
Sr.Procurement Officer, three Procurement Officers) take care of purchasing mechanical equipment, electrical equipment, logistic services and consumable All are generally called equipment.
Problem symptoms
To find out what are the current problems that procurement team is facing with, the writer carried out in-depth interview with Ms Giang, Procurement Manager of KNOC
Based on the review results and the date provided, onshore‑to‑offshore transportation costs rose from 2013 to 2015, yet the payable amount exceeded the approved budget even though transportation rates remained unchanged.
Report for transportation cost of chopper
Q'ty Price Total Amount Q'ty Price Total Amount Q'ty Price Total Amount Scheduled flights 104 26,000 2,704,000 104 26,000 2,704,000 104 26,000 2,704,000
(Source: KNOC VN’s yearly report)
Late delivery of equipment is the first reason cause to cost overrun
KNOCVN purchase order records reveal significant equipment quality concerns, with many items arriving in poor condition, including refurbished units rather than brand-new ones These devices tend to have a short operational lifespan, leaving end users unable to sustain the operating period; some fail without warning or cannot be repaired.
Third, the item delivered is incorrect—the equipment does not match the part number listed on the purchase order This delivery error means we must initiate a return and wait for the correct replacement, which will take additional time.
In accordance with report and information, it can be concluded that the issue of late in delivery materials and equipment is the central problem.
Problem definition and importance of the problem
Research by Al-Momani highlights that late delivery of equipment and delays in issuing notices to proceed to site are major contributors to project delays Ismail and colleagues note that late, irregular, or incorrect material deliveries during construction can reduce productivity and lead to cost overruns Flyvbjerg et al define cost overrun as the difference between the actual cost at project completion and the initial budgeted cost.
Potential causes of problem and the justification
Based on the interview, the company is experiencing a cost overrun From 2007 to 2012, transportation costs from onshore to offshore remained constant year over year The company had utilized equipment and spare parts purchased with the main machinery during the project phase From 2013 to 2015, annual transportation costs from onshore to offshore rose significantly as the company relied on ad hoc choppers These ad hoc choppers were deployed to move critical equipment when deliveries were late.
Rosneft Vietnam, formerly TNK-BP Holding, has assembled a procurement team of qualified, skilled professionals The company has adopted standardized procurement procedures for its global offices, leveraging a strong pool of human capital and a supportive system to drive procurement efficiency This combination enables the procurement team to operate with high efficiency across locations They rarely rely on ad hoc helicopters or supply boats to move equipment onshore to offshore in emergencies, reflecting a disciplined and reliable logistics approach.
1.5 Potential causes of problem and justification
Based on an interview with Ms Giang, the procurement function is responsible for sourcing equipment that meets the right quality standards at the most cost-effective price and for ensuring equipment is available when needed All equipment is purchased and delivered to the KNOC warehouse in Vung Tau city According to end-user requirements on the Rong Doi Platform offshore, items are sent offshore by supply boat or helicopter (chopper) The company typically operates two regular supply boats per month to transport cargo such as food and equipment to offshore, and two regular helicopters on Mondays and Thursdays to bring manpower and small items of equipment offshore All equipment must be delivered on time in accordance with the schedules of the choppers and supply boats.
Among the five procurement team members, two were reassigned from the document control department without relevant procurement experience, and their contributions did not meet the required standards According to the job design, the procurement officer should act as the primary point of contact for suppliers, maintaining proactive communication to ensure on-time delivery of equipment Nevertheless, several purchase orders were not delivered on time due to slow responses and delayed decision-making by the procurement team When vendors raised issues with purchase orders, they often did not know who to contact and faced lengthy delays before decisions were made This lack of clear internal communication and support across internal parties contributed to failures on some critical orders with vendors.
Negotiation skills are essential for procurement staff, enabling them to resolve day-to-day disputes and address challenging user requirements Through effective negotiation, procurement professionals ensure that requirements are commercially sound and add value, while also serving as a means of conflict resolution between buyers and suppliers In successful negotiations, a negotiator obtains greater value in exchange for something with lower relative value Conversely, a lack of negotiation skills can lead to longer procurement processes, delays in project awards, and higher costs.
Since 2013, the company has faced a persistent oil price downturn that has strained its finances, limiting capacity for investment in growth It currently lacks a dedicated training budget for staff, leaving both new hires and existing employees without the information and skills needed to perform at their maximum potential Without structured employee training and ongoing skills development, tasks are not executed efficiently, hindering productivity and the ability to maximize performance.
Training programs give employees information, new skills, and professional development opportunities to fulfill their responsibilities in the workplace Training is a necessity in the workplace because it builds capabilities and supports continual growth Effective training and development initiatives are designed to improve employees' performance and drive better results for the organization.
The company uses the MBO (Management by Objectives) program to evaluate employees' performance; however, staff have not received feedback from the Human Resources department on their results, nor have they received any salary increases By 2014, the company had not increased salaries for staff.
Evaluating and ranking employees within an organization is a challenging task because performance is influenced by multiple factors Each employee demonstrates varying levels of achievement across diverse metrics, creating a wealth of information that can be overwhelming to interpret A robust performance evaluation program should do more than base salary and promotion decisions on past performance; it should employ a multifactor assessment that supports fair compensation, targeted development, and strategic talent management aligned with organizational goals.
Procurement in complex, one-off projects is inherently uncertain, making it a critical lever for profitability across many industries Because each project is unique, the procurement function must manage technical complexity, risk, and value throughout the lifecycle The procurement process is often depicted as a sequence of decisions made by multiple stakeholders with different authorities, highlighting the need for clear governance and cross-functional coordination From identifying a business need and defining requirements to selecting a supplier and signing a contract, the procurement lifecycle covers all activities required to secure a solution that meets objectives and delivers an acceptable outcome.
Shehzad 4 stated that among the five most frequent causes of oil & gas construction project delays were identified is shortage of skilled labor Derek et al 5 explained on human capital and ways in which its effectiveness can be leveraged through procurement systems Human capital consists of the skills, competences and knowledge and creative energy that employees bring an organization
Section 7.3 of the procurement procedure requires bidder selection to be completed before sending inquiries to suppliers Bidders are selected based on their technical and financial capabilities, ensuring that only qualified suppliers proceed The Bidder List may include companies evaluated on criteria such as experience, track record, past performance, financial statements, and the key personnel experience of the company.
The KNOCVN procurement procedure lacks a systematic process for selecting and evaluating supplier performance, leading to ad hoc and non-strategic decisions There is no logical framework guiding supplier selection, and sourcing is predominantly based on the experience of individual procurement officers As a result, equipment is typically procured from familiar suppliers or those already represented in Purchase Orders and Contracts records Moreover, there is no recording of supplier performance across key dimensions such as product quality and delivery timeliness, making it difficult to assess reliability or drive continuous improvement.
KNOC VN's procurement process begins when offshore or onshore engineers generate purchase requisitions detailing the required materials, including quantity, description, specifications, required on-site date, drawings, and other relevant data Each item in the requisition clearly identifies the brand or manufacturer, while standard or generic items may not specify a brand After a requisition is received, the procurement officer requests quotations from suppliers, and engineers perform a technical evaluation of the supplier’s quotations while the procurement officer conducts a price comparison The purchase order is awarded to the supplier that meets technical requirements and offers the lowest total cost.
Procurement faces a large volume of small-value purchase orders as end-users raise numerous purchase requisitions, but big suppliers are often too busy to respond promptly and fail to consolidate these inquiries Because procurement officers push many small orders to large suppliers without securing a penalty clause, suppliers are reluctant to commit After failed negotiations with big suppliers, the team places purchase orders with a trading company, unaware that the trading company may not hold stock and will only confirm availability once they receive a client PO, leading to stockouts and delays.
ALTERNALTIVE SOLUTION
Solutions
The company is currently facing cost overruns in offshore transportation from onshore facilities, driven by gaps in staff qualifications and shortcomings in procurement procedures To address these challenges, implement targeted staff training programs to raise competency, maintain a ready stock of essential equipment to prevent delays, and establish a transparent supplier selection and rigorous performance evaluation process for procurement staff These measures can reduce logistics costs, improve offshore project efficiency, and create a more resilient onshore-to-offshore transportation workflow.
Solution comparison
Training staff Stock equipment Provide process
- To increase competitiveness for firms through raising skill levels
- To enhance the ability of employees to perform their jobs at peak level
- Available to use at any time
- To control the production capacity
- To select the right supplier
- To build a good relationship with supplier
Every item needs to be available at
On job training by Sr Procurement Officer /
- Professional development courses from oversea centers warehouse using for one replacement
Timing Every year Every year 3 months
Solution selection
Based on the comparison above, the author argues that the most effective solution to the company's problems is to establish a supplier selection and performance evaluation process This process is essential for identifying the strengths and weaknesses of suppliers and helps the company manage its supplier base more effectively Implementing supplier selection and performance evaluation also enables monitoring of day-to-day supplier operations, ensuring consistent performance and alignment with business objectives.
Outsourcing has emerged as a key process that contributes to a firm's competitive advantage, leading organizations to focus on their core competencies while outsourcing remaining activities to external suppliers These suppliers are increasingly responsible for the design of new products, sub-assemblies, and component parts, enabling firms to accelerate innovation and streamline operations.
Hotabe et al find that supplier competency, service quality control, transaction cost drivers, brand image, and country characteristics are more influential than other factors in supplier evaluation Accordingly, the supplier selection and evaluation process should go beyond price to consider a broad set of criteria, including quality, organizational capability, and relationship dynamics, so decision making reflects the supplier’s total capability in a long-term, strategic perspective.
Shenhar et al 12 suggested that adopting effectiveness measures will more often lead to project success, by relating success to long-term impacts to the business.
Solution details
Qualifying and selecting new suppliers method
To thrive in the global economy, businesses must not only strengthen existing supplier relationships but also continually identify new suppliers New suppliers can outperform current ones or offer structural cost advantages—such as lower labor costs or favorable import/export regulations—making supplier diversification valuable Existing suppliers may go out of business or become more costly, so adding alternative sources helps maintain resilience Having multiple suppliers also stimulates competition, reduces supply disruption risks, and supports objectives like supplier diversity.
Production delays from parts shortages and recalls of faulty products sourced from noncompliant suppliers have cost buyer firms millions of dollars in recall expenses, warranty costs, and inventory adjustments These disruptions have also inflicted lasting damage on reputations and eroded future sales potential.
Lopez 13 stated that supplier selection is one of the most crucial components of the purchasing function of a firm It becomes a strategic decision when the purchasing organization attempts to establish a long-term and win-win business relationship with its suppliers In order to select the right supplier, comprehensive and configurable metrics for supplier selection must be outlined early in the process Depend on each industry, the supplier selection criteria is being considered
The proposed model aligns with the company's strategic priorities by embedding top-level policies and procurement requirements into a fundamental Supplier Portfolio management framework that guides supplier selection and empowerment in line with corporate and procurement strategies It consolidates similar project requirements into attractive supplier packages, so suppliers are selected not only on price and quality but also for strategic partnership potential and long-term development outlooks In this model, outsourced items are divided into two Pareto-based groups: approximately 80% of non-critical items, low in price, can be purchased using simple or traditional methods, while the remaining 20% are selected through Supplier Portfolio methodologies that actively weigh corporate, business, and procurement strategic elements.
Our guidance establishes the performance criteria for evaluating potential sources of supply and for assessing current suppliers—especially for items not traditionally provided by standard vendors Management requires that supplier selection occur only after the purchasing department has thoroughly reviewed all criteria, guaranteeing a rigorous, objective, and criteria-driven evaluation before any sourcing decision.
Supplier selection criteria include the following:
‐ Engineering and manufacturing technical competence
‐ Management of its own suppliers
‐ Ability to work with the customer
Teng 14 stated that there are a number of approaches being used to assist the supplier performance evaluation Four commonly-used traditional methods stated in several studies are categorical method, weighted-point method, cost ratio approach and dimensional analysis model, analytic hierarchy process (AHP)
The Analytic Hierarchy Process (AHP) model was selected because it can effectively respond to and fulfill the company’s objectives by recognizing that evaluation criteria carry different levels of importance when compared with homogeneous criteria AHP is designed to decompose a complex, multi-criteria problem into a hierarchical structure, offering flexibility and systematization to highlight the key elements of the problem To support a sound performance framework, four main criteria—quality, delivery, service, and flexibility—are used, with eighteen sub-criteria distributed among them to form a coherent conceptual model for supplier performance evaluation.
AHP, or analytic hierarchy process, is a flexible, systematic problem-solving tool that helps structure and analyze complex decisions It decomposes a complicated, multi-criteria problem into a hierarchical model, with the objective at the top, criteria and sub-criteria in the middle, and alternatives at the bottom The relative weights of the criteria reveal which factors carry the most priority in the decision As Ordoobadi et al (2015) explain, a sequence of pairwise comparisons among all criteria determines these weights, enabling the construction of a robust supplier evaluation system.
Identifying the evaluation criteria that directly relate to supplier performance is the most important step in the supplier performance evaluation process A solid framework highlights the major criteria used to assess supplier effectiveness, including quality, on-time delivery, cost competitiveness, and lead times, as well as service, responsiveness, and flexibility By combining quantitative metrics (defect rate, on-time delivery, total cost of ownership) with qualitative indicators (communication quality, cooperation, risk management), organizations create a comprehensive, SEO-friendly evaluation that supports benchmarking and continuous improvement Tailoring these criteria to industry context and product risk ensures the evaluation stays relevant and actionable.
Kwong et al indicate that supplier performance extends beyond price or quality and requires a multi-criteria evaluation process While quality remains the top priority for satisfying customers, other attributes are also important and must be considered Therefore, buying companies should identify and select evaluation criteria that align with their objectives and activities to best serve customers Cormican et al conclude that identifying criteria and metrics that are objectively relevant to the company at all levels is crucial.
Main- criteria Sub-criteria Description
Quality of product Supplied goods comply with specifications with no defect Quality of packaging/packing
Supplied goods are securely packed, with packaging that is suitable for safe transportation and storage All required supporting documents and materials accompany the shipment to ensure compliance and smooth processing Delivery is on time, with goods arriving at the specified destination as agreed.
Delivery accuracy Goods are delivered accurately with no missing or Non-splitting delivery Goods are delivered in large lot and with no
Supplier informs in advance if the delivery schedule is not as planned
Shipping document is issued correctly and accurately
Supplier promptly arranges replacement delivery if defect or discrepancy is found Service Responsiveness to request for quotation
Supplier promptly submits quotation after receiving a request for quotation
Responsiveness to Supplier quickly responses back when
Information sharing Supplier willingly supports and shares information, e.g Quality of sales person Salesperson is knowledgeable about the goods and accurately and courteously to support company’s Communication systems
Supplier has good and reliable communication system, e.g email system, document tracking
Inventory availability Supplier always has inventory on-hand to fulfill customer’s demand
We maintain ample on-hand inventory to respond quickly to supplier needs and ensure we can meet every order without delay We offer flexible order customization to tailor products and specifications to your exact requirements We are also negotiable on price and delivery schedules, providing flexible terms that align with your budget and timelines.
Supplier evaluation typically follows a rigorous, structured process based on formal surveys A high-quality supplier survey should be comprehensive, covering the performance categories that are important to the evaluation and selection process The survey process should be as objective as possible, which requires a scoring system that defines the meaning of each value on the measurement scale In addition, the items and the measurement scales must be reliable to ensure consistent results.
An annual supplier performance evaluation should be conducted by the end of each year, and the results should be communicated to all procurement officers to guide the processing and fulfillment of incoming orders.
These problems typically trace back to unclear specifications or careless supplier selection, and they are often worsened by the absence of systematic supplier evaluation When vendors aren’t assessed rigorously, troublesome suppliers remain in the supply chain, causing recurring delivery problems and quality issues.
ACTION PLAN
The best way to ensure supplier is to achieve a common view of the potential for improvement and systematically track the implementation of purchasing The process of supplier selection and performance evaluation should be applied It will help both buyer and seller understand each other’s The program needs to be implemented as soon as possible
According to the current company’s financial status, the program will be drafted by
Sr Procurement officer with reviewed and commented by Procurement Manager The timeline is as below:
No Description Person In charge Date
1 Draft the process of supplier selection and performance evaluation process
2 Review and comment Procurement Manager 21 April 2017
1 How long have you been working for this organization?
I have been working for this organization for ten years
2 How many staff in your department?
Our team has five members including me (one manager, one senior procurement officer, three procurement officers)
3 How long have they been working for this organization?
All of them have been working for this organization for more than 8 years
4 Do they have experience/background of procurement works before joining your department?
Two of them were recruited from oil & gas trading companies then they have experience and background of their works, two of them have been working for controller team for long time They were shifted this department for more than three years They are familiar with oil & gas industry but they do not have any experience and back ground of procurement works
5 Can you describe the function of procurement department?
The Procurement team is responsible for procuring materials, equipment, and services needed for rig operations The procurement process begins with an approved purchase requisition and continues through supplier confirmation, goods receipt, and ultimately payment to suppliers, ensuring timely delivery, quality conformity, and cost efficiency.
6 How do you manage your staff for effective purchasing decision?
Procurement work is organized into four functional streams—mechanical, electrical, logistics, and consumables—each overseen by a dedicated procurement officer who specializes in that area From the initial requirement gathering through supplier selection, order placement, and delivery, these officers coordinate to ensure an end-to-end procurement process By dividing responsibilities across mechanical, electrical, logistics, and consumables, the team achieves focused sourcing, tighter control, and faster throughput, while maintaining consistency, compliance, and traceability across the entire procurement cycle.
7 What would you feel about their working behavior?
They are polite They follow the company policy, go to work ontime
8 Do they well communicate with other teams?
Team communication is the core problem, fueled by personality clashes that cause members to spend more time debating issues than implementing them This reflects weak communication skills, especially in delegating tasks and driving timely project execution Without a clear team direction or shared focus, dissension and frequent arguing erode collaboration and derail progress, ultimately hindering task completion and team performance.
9 Do they have good communication and relationship with suppliers?
In general, they have good communication with supplier but they need to build good communication and relationship with key supplier
10 Do they try their best to meet the deadline?
They work hard but sometime unable to meet the deadline, for example the deadline of goods receipt for rig maintenance
11 What made they worked hard to meet the goal? How about salary increasing
Promotion Company did not increase salary by 2014 due to oil price deceasing
12 What could they do differently to help your department better perform?
Some team members are highly proactive, doing their best to find solutions whenever problems arise Others struggle with workload management When issues occur, they typically receive information from the vendor and report it.
13 What are the personal development areas in which they need to improve?
They need to improve the working skills such as negotiation skill, information technology skill, and the most importance is problem solving skill
14 Are there any problem / conflict between procurement with other team?
Workplace conflicts often arise from differences in approach or personality An employer who is detail-oriented and reviews each step in minute detail may clash with an employee who prefers a more creative, collaborative approach to a project Personal differences can also fuel tension, such as a subdued employer demeanor contrasting with an employee's more effervescent energy These divergent responses to situations can lead to occasional conflicts, highlighting the value of clear communication and aligned expectations to manage differences effectively.
15 Do you provide any professional training course to your department for the last three years?
Before that the company yearly offered training course to staff but for the last two years the training was no more offered due to oil price is going down
16 Do you have procurement procedure or procurement strategy?
We have procurement procedure It is now version 3.0 applying from year of 2011 upto now
17 How many members are involved within procurement process? Who is contact point?
The team includes engineers, a procurement officer, legal, an import-export officer, accounting, and a warehouse controller The procurement officer serves as the central contact for coordinating with other teams and vendors A typical order starts when an offshore or onshore engineer creates a purchase requisition The procurement officer handles vendor quotations and clarifies both technical and commercial terms with suppliers After the purchase order is signed, materials or equipment are delivered to the warehouse, and payment is made to the vendor.
18 How many suppliers you have on the list? Are they local or oversea? Are they manufacturers or trading companies?
We have a thousand of suppliers They are local vendors, oversea vendors, manufacturers, trading companies
19 How many purchase orders your team issued for a year? Are they ontime delivered?
It is around one thousand purchases orders for both local orders and oversea orders
20 Can you let me know the minimum purchase order value as well as maximum purchase order amount?
It is around 100 USD up to 3,000,000 USD
21 Did you apply liquids damaged for late delivery order?
The liquids damaged rate is one percent (1%) per day and up to maximum of ten percent (10%) of purchase order
22 Does your supplier agree to apply liquid damaged for late delivery?
It is very hard to negotiate with vendor for applying liquids damaged specially for the orders with small amount
23 How long usually takes place for an order to be completed?
It is around six weeks from purchase requisition approved to purchase order approved The delivery time or lead time is relied on quotation of supplier
24 Is it enough time for supplier to response to your request? Did they ask to extend the deadline?
We set the timeline for supplier to response within one week Sometime they asked to extend for more time
25 How fast the supplier responses to your request?
One day, two days or two weeks It is depended on their available and the order value
26 Is the supplier willing to support you in urgency issues?
It depend on what case
27 Does the supplier ask for price increasing with a valid reason?
Yes, they asked for pricing increasing but sometime without a reason
28 Is there any process for identifying critical supply categories?
29 How often you do KPI for suppliers?
We have never been done it
30 Do you think Procurement have significant impact on company?
Effective procurement of materials and services drives a company’s competitive advantage The quality of inputs—materials, equipment, and services—directly affects operational quality and output, shaping overall production capacity When procurement is not conducted efficiently and effectively, input costs rise, eroding margins and risking a loss of production capacity.
31 What are the most difficult issues in your department now?
Under pressure from headquarters to achieve cost savings, we are dealing with volatile costs for materials, equipment, and transportation that make budgeting unpredictable While staff training is necessary to maintain performance, there is no dedicated training budget available We need practical cost-reduction measures that preserve quality and capability, such as optimizing procurement, streamlining logistics, and finding affordable training solutions that fit the current financial constraints.
APPENDIX B: TERMS AND CONDITIONS OF PURCHASE
1 ACKNOWLEDGMENT AND ACCEPTANCE OF ORDER
The Terms and Conditions of this Purchase Order shall apply to the purchase of goods, materials, items, products, components or services (hereinafter referred to as
All exhibits, attachments, technical specifications, drawings, notes, instructions, or information referenced in this Purchase Order are incorporated by reference These Terms and Conditions govern the Purchase Order unless the terms on the face of the Purchase Order state otherwise This Purchase Order supersedes all prior written or oral agreements and understandings, except as varied by the terms on the face of the Purchase Order.
The Vendor shall supply and deliver to Buyer the Materials in the manner and in the quantities stipulated on the face of this Purchase Order
Unless the Seller's quotation states otherwise, all delivery or completion periods run from the Effective Date and are binding commitments of the Seller The Seller shall promptly notify the Buyer of the causes of any late delivery and provide an estimated delivery time to enable mutual agreement The Seller agrees that liquidated damages shall be payable at 1% per day for each day of late delivery, up to a maximum of 10% of the total value of the delayed Goods, and these damages shall be deducted from the Buyer's payment if the Buyer agrees to the late delivery.
If the Seller is delayed or prevented from performing its obligations under the Contract due to the Buyer's acts or omissions (including, but not limited to, failure to provide specifications, fully dimensioned working drawings, or such other information reasonably required by the Seller to proceed expeditiously), the delivery schedule and the Contract Price will be adjusted accordingly.
If delivery is delayed due to any act or omission or at the Buyer's request, or if the Goods are ready for dispatch but the Buyer fails to take delivery or provides inadequate shipping instructions, the Seller may place the Goods in a suitable storage facility at the Buyer's expense Once the Goods are placed in storage, delivery shall be deemed complete, the risk in the Goods shall pass to the Buyer, and the Buyer shall pay the Seller accordingly.
The Materials remain at the Vendor’s risk until delivery in accordance with this Purchase Order Title to the Materials and the risk of loss pass to the Buyer at the time of delivery, unless the Purchase Order states otherwise.