Delivery terms
The contractual conditions governing how, when and where goods or services are delivered.
Definition
Delivery terms set out the time, place and method of delivery, the moment risk and ownership pass, and the consequences of late or non-conforming delivery. They often incorporate Incoterms for cross-border trade and interact with retention-of-title and inspection provisions. Clear delivery terms are central to allocating transport risk and to determining when the buyer must pay.
Example
The delivery terms require goods to be delivered DAP to the buyer warehouse within ten working days of the order.
Why this is a business risk
Ambiguous delivery terms are among the most frequent triggers for commercial disputes. If the delivery location, required method, acceptable lead time and inspection window are not defined, disagreements about whether delivery has occurred, whether it was conforming and whether payment is due become very hard to resolve. In supply chains, delivery term gaps compound across multiple tiers.
How to manage it
- Specify the delivery location down to the exact address or named place; "buyer premises" is insufficient for logistics planning and insurance.
- Define the delivery lead time, the start event (order confirmation, payment, readiness notice) and any partial delivery rules.
- Incorporate an inspection period and a defect notification deadline so the buyer cannot raise quality claims indefinitely after delivery.
- State who bears the risk and cost of transport and insurance, either by naming an Incoterm or by a clear bespoke allocation.
- Link the payment obligation to the confirmed delivery event, not to shipment, where possible, to avoid paying for goods that have not yet been received.
Frequently asked questions
Common questions about this term.