Fixed, Open-Item, and Category Contract Relationships

Three types of contract relationships can be established: fixed item, category, and open-item. Fixed item contracts are valid only for purchases and payments that specifically reference the items that are identified on the contract. You can also establish multiple contracts for the same item and supplier combination, as long as the beginning dates of the contracts do not overlap. The system uses the most current date to determine which contract to use to fulfill an order. The system enables the use of an item multiple times on a contract, once as a standalone item and other times as part of line groups.

Open-item contracts are agreements that apply to any item that is purchased from the supplier while the contract is in effect. Open-item contracts are typically used to set up a percentage-off list price that applies to any item that is purchased from the supplier. Fixed item and open-item agreements can be established on the same contract. Open-item contracts apply only to purchase order contracts.

Category type contracts enable you to create a contract based on a category of items. Category contracts are typically used to set up a percentage-off list price that applies to any item within the category. Using category contracts, you can also define items that can be excluded from the category. Only the default category defined on the item is considered for selection. The system automatically searches for and references contracts at the category-level on requisitions and purchase orders. This is a more granular level of control than the open item contract, and enables you to enter a group of items instead of entering them individually on the contract.