Sigma Healthcare NZ Updates Supplier Purchase Order Terms and Conditions
Sigma Healthcare NZ Ltd has outlined comprehensive terms and conditions governing the purchase, supply, delivery, quality, pricing and distribution of products from its suppliers. The framework is designed to establish clear responsibilities between Sigma and its suppliers while supporting reliable product availability, regulatory compliance, supply-chain transparency and customer service across New Zealand.
The terms are intended to be read together with the applicable Sigma Supplier Agreement and individual purchase orders. Together, these documents establish the contractual framework under which suppliers provide products to Sigma for distribution and sale.
Responsibilities of Sigma
Under the agreement, Sigma is expected to use reasonable commercial efforts to market, distribute and sell products within the nominated territory. The company is also responsible for maintaining appropriate inventory, facilities and adequately trained personnel to meet customer demand and fulfil its contractual obligations.
This approach places emphasis on maintaining continuity of supply while ensuring Sigma has the operational resources required to distribute products effectively. For suppliers, it also provides greater clarity around Sigma’s role in supporting product distribution and market access.
Supplier responsibilities and information sharing
Suppliers have significant obligations under the terms. They are expected to provide timely and accurate information about their products when reasonably requested by Sigma. This includes information that may help identify opportunities for operational improvements during the agreement.
Suppliers must also provide marketing materials, promotional information, product imagery and other documentation normally supplied to distributors. Additional documentation may be requested when reasonably necessary for Sigma to market, distribute, promote and sell products.
All documentation must comply with applicable New Zealand laws and regulatory requirements. Depending on the nature of the products, these requirements may include the Medicines Act 1981, Food Act 2014, Fair Trading Act 1986, Hazardous Substances and New Organisms Act 1996 and relevant Ministry for Primary Industries requirements.
Sigma is also granted a non-exclusive, royalty-free licence to use and reproduce relevant supplier documentation during the term of the agreement for legitimate marketing, sales and distribution purposes.
Contract management and communication
Both parties are required to nominate representatives who will serve as their principal contacts under the agreement. These representatives are expected to meet every three months, unless another schedule is mutually agreed.
Regular meetings provide an opportunity to review performance, discuss supply issues, address operational challenges and identify opportunities for improvement. This creates a structured communication channel between Sigma and its suppliers.
Purchase orders and individual contracts
Sigma may issue purchase orders for products from time to time. A supplier accepts an order when it communicates acceptance, begins dispatching the products or delivers any of the ordered products, whichever occurs first.
Once accepted, the individual contract consists of the purchase order, the overarching agreement and any other documents agreed by the parties.
Importantly, Sigma does not commit to purchasing minimum quantities under the general agreement. Only individual purchase orders that have been accepted in accordance with the agreement create binding purchase obligations.
This provision gives Sigma flexibility to manage purchasing according to customer demand, inventory requirements and market conditions.
Delivery and supply reliability
Timely and complete delivery is a major component of the agreement. When a supplier accepts an order, it must deliver the specified products in full to the designated site by the applicable delivery date.
Suppliers are generally expected not to interrupt, delay, abandon or withhold deliveries except where a recognised force majeure event applies. The requirement reflects the potential impact that supply interruptions can have on Sigma and its downstream customers.
Suppliers must keep Sigma informed about expected delivery times and notify the company of events that could result in late delivery.
Where delays occur, Sigma may permit products to be supplied as backorders or, where appropriate, cancel affected products from the order. If an order is cancelled because of a confirmed delay, the supplier must refund amounts already paid for the affected products.
Backorders are subject to additional controls. Suppliers must provide regular updates on expected delivery dates, and revised delivery dates must be approved before the products are dispatched.
Delivery standards and product acceptance
Suppliers must comply with applicable New Zealand shipping and transportation requirements and obtain necessary approvals, permits and consents.
Deliveries must be clearly labelled with the correct site address and accompanied by appropriate delivery documentation.
Sigma may reject products that fail to satisfy specified delivery requirements. This includes excess quantities, products with insufficient remaining shelf life without prior approval, and products with damaged packaging, broken seals or indications of tampering or contamination.
Rejected products remain the supplier’s responsibility and must be collected at the supplier’s expense.
Risk, title and ownership
The supplier retains the risk of loss associated with products until those products are delivered into Sigma’s control at the designated site.
Title generally transfers to Sigma upon payment or when Sigma sells the products to its customers, subject to the specific terms of the agreement.
Suppliers must also warrant that they own the products free of liens, charges and encumbrances and that Sigma will receive clear possession of the products and related documentation.
Product quality and technical information
Product quality is a central element of the supplier obligations. Suppliers must provide current technical information, including ingredient lists, certificates of authenticity and safety data sheets where applicable.
They must also cooperate with Sigma regarding product master data, acceptance processes and record keeping. Product information must be provided in appropriate formats to support storage, handling, promotion, distribution and resale.
The supplier warranties require products to be of acceptable and merchantable quality, free from manufacturing defects and contamination, and suitable for their intended purpose.
Products must also correspond with descriptions, specifications, samples and applicable quality, safety and efficacy standards.
Regulatory compliance
Suppliers are responsible for ensuring products are manufactured, packaged, labelled and delivered in compliance with applicable laws and mandatory standards.
For regulated products, this can include requirements under New Zealand medicines, food, hazardous-substance and consumer-protection legislation. Where applicable, products must also meet relevant Standards New Zealand requirements and other applicable health, safety, environmental, packaging and labelling standards.
The supplier’s obligations continue throughout the product’s relevant warranty period.
Defective products and corrective action
If Sigma identifies a defective product during the applicable warranty period, it may require the supplier to take corrective action at its own cost.
Potential actions include cancelling outstanding orders for the affected product, collecting products already delivered, refunding amounts paid and replacing defective products within the required timeframe.
The agreement also establishes limited circumstances where warranties may not apply, such as defects caused by Sigma’s own actions, inappropriate product use or failure to follow supplier storage or transportation instructions.
Product recalls and withdrawals
The agreement places primary responsibility for product recalls on the supplier while requiring close cooperation with Sigma.
If either party becomes aware of an actual, potential or threatened defect that could make products unsuitable for sale, the other party must be notified immediately.
Recall information should identify affected products, batch numbers, quantities, relevant dates, product codes and distribution details, as well as the nature of the problem and proposed corrective actions.
Recall activities are intended to minimise risks to consumers and may include withdrawing products from sale, recalling products already distributed, complying with regulatory requirements and providing relevant information to authorities and the public.
The supplier is generally responsible for costs associated with recalls, except where the loss is directly attributable to Sigma’s negligence or wrongful conduct.
Managing the product range
The agreement also provides a framework for managing Sigma’s product portfolio.
Suppliers must notify Sigma about changes to their product lines and provide information needed for Sigma to determine whether products should remain listed, be added or be removed.
Suppliers may request the addition of new products, although Sigma retains discretion over whether to accept such requests.
Suppliers can also discontinue products subject to advance notice requirements. Sigma may cancel outstanding orders for discontinued products, while both parties are expected to make reasonable efforts to sell remaining inventory during the notice period.
Sigma may also remove products from its range where sales targets are not achieved, funding arrangements change or other specified conditions apply.
Managing slow-moving and expiring inventory
Inventory management is another important component of the terms.
Sigma and suppliers are expected to periodically review slow-moving, short-dated and excess inventory and work together to sell remaining stock through appropriate commercial initiatives.
Under certain circumstances, Sigma may return products for full credit. These circumstances can include products approaching expiry because of low sales, supplier regulatory approvals approaching expiration, or inventory that exceeds updated forecast requirements.
The provisions are designed to reduce waste, improve inventory efficiency and ensure that products remain commercially viable throughout the supply chain.
Pricing and payment
The agreement establishes a pricing framework based primarily on the supplier’s list price at the time an order is submitted, subject to applicable discounts, rebates, fees and other agreed adjustments.
Unless otherwise agreed, packaging, transportation and delivery costs are incorporated into the product price.
Suppliers may change list prices, but notice requirements apply. For many price changes, Sigma must receive advance written notification and may need to validate the change.
The agreement also establishes mechanisms for addressing price reductions and differences relating to inventory already held by Sigma or products currently on order.
Suppliers must issue compliant invoices, while Sigma retains rights to dispute amounts in good faith and withhold disputed portions where permitted.
Record keeping and audit rights
Suppliers must maintain sufficient records to enable Sigma to verify invoices, payment claims and other amounts payable under the agreement.
These records must generally be retained for seven years following expiration or termination.
Sigma may request access to relevant records during the inspection period, subject to the conditions set out in the agreement. This supports financial transparency and helps ensure that contractual payments and claims can be independently verified.
Confidentiality and information protection
Both parties are required to protect confidential information and may only use or disclose it for purposes permitted under the agreement.
Certain disclosures are permitted, including disclosures to related entities, professional advisers, regulators, courts or other parties where legally required.
When the agreement ends, confidential information generally must be returned or destroyed, subject to legal record-retention requirements.
Termination and suspension
The agreement provides mechanisms for termination where serious contractual problems arise.
Either party may terminate for material breach if the breach is not remedied within the specified period or cannot be remedied. Termination may also occur following an insolvency event.
Sigma has additional suspension and termination rights where there are reasonable concerns involving ethics, compliance, sanctions, human rights or other specified obligations.
These provisions reinforce the importance of responsible business conduct and regulatory compliance throughout the supplier relationship.
Force majeure and insurance
The agreement recognises that certain circumstances beyond a party’s control may prevent contractual performance.
Where a force majeure event occurs, the affected party must provide prompt notice, explain the obligations affected, describe the event, estimate its expected duration and identify mitigation measures.
Affected non-payment obligations may be suspended while the event continues. However, the affected party must make reasonable efforts to minimise its impact.
If a supplier remains unable to perform for more than 30 business days because of a force majeure event, Sigma may have the right to terminate the agreement.
Both parties are also required to maintain specified insurance coverage and provide evidence of insurance when reasonably requested.
Liability and indemnification
The supplier has broad indemnification responsibilities under the agreement. These include losses associated with personal injury, property damage, warranty breaches, defective products, intellectual property claims, confidentiality breaches and the supply or use of products.
The supplier’s indemnification obligations are generally subject to exceptions where loss is directly attributable to Sigma’s breach, negligence or wrongful conduct.
The agreement also establishes limitations on liability for certain consequential, indirect or incidental losses.
Dispute resolution
If a dispute arises, either party may issue a formal dispute notice. The parties are expected to first attempt to resolve disagreements through good-faith negotiations.
If the dispute remains unresolved, it may be escalated to senior representatives. The parties can subsequently agree to mediation under the Resolution Institute Mediation Rules or proceed with legal action where appropriate.
Importantly, the existence of a dispute does not generally suspend the parties’ contractual obligations. They must continue performing the agreement unless otherwise agreed.
New Zealand legal framework
The agreement is governed by New Zealand law, with the parties submitting to the non-exclusive jurisdiction of New Zealand courts.
It also contains provisions covering GST, notices, assignment, subcontracting, independent contractor relationships, amendments, severability, waiver, entire agreement and other standard contractual matters.
Overall, the Sigma Healthcare NZ purchase order terms establish a detailed framework designed to balance commercial purchasing with supply reliability, product quality, regulatory compliance and customer protection. The agreement places substantial responsibilities on suppliers for product integrity, delivery performance, documentation, recalls, licensing and regulatory compliance, while giving Sigma mechanisms to manage inventory, pricing, product ranges and contractual risk.
For suppliers, compliance with these requirements is important not only for maintaining the commercial relationship with Sigma but also for supporting the safe and reliable distribution of healthcare products throughout New Zealand.
Source link: https://sigmahealthcare.com.au/
