# Delivery terms

Source: https://contracko.com/glossary/delivery-terms

# 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.

### How Contracko helps

Contracko extracts delivery obligation data from uploaded contracts, including lead times, delivery windows and inspection deadlines, and tracks them alongside payment terms. This gives supply chain and procurement teams a single view of upcoming delivery obligations and the payment triggers attached to them.

## Relevant for

[Logistics & Distribution](https://contracko.com/industries/logistics)[Manufacturing](https://contracko.com/industries/manufacturing)[Retail & Wholesale](https://contracko.com/industries/retail-wholesale)[Freight Forwarding](https://contracko.com/industries/freight-forwarding)

## Related clauses

- [Retention of Title](https://contracko.com/clause-library/retention-of-title)
- [Notices Clause](https://contracko.com/clause-library/notices)

## Related terms

- [Incoterms](https://contracko.com/glossary/incoterms)
- [Purchase conditions](https://contracko.com/glossary/purchase-conditions)
- [Retention of title](https://contracko.com/glossary/retention-of-title)
- [Notice of defect](https://contracko.com/glossary/notice-of-defect)

### Never miss a contract deadline again

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## Frequently asked questions

Common questions about this term.

- **Q:** When does risk pass under typical delivery terms?
  **A:** Risk passes at the point defined by the delivery terms or the applicable Incoterm. For DAP, risk passes when the goods are placed at the buyer disposal at the named place; for FCA, it passes when the seller hands the goods to the carrier.

- **Q:** Can a buyer refuse delivery if the goods do not conform?
  **A:** Yes, if the non-conformity is clear and material at the time of delivery. The buyer should document the defect immediately and notify the seller within the contractual notification window. Acceptance of non-conforming goods may waive the right to reject.

- **Q:** What is the consequence of late delivery?
  **A:** The consequences depend on the contract. Options include a damages claim, a right to cancel specific orders, a right to source elsewhere at the supplier cost, or liquidated damages if the contract provides a pre-agreed rate for delay.

- **Q:** Are delivery terms and general terms and conditions the same thing?
  **A:** Not necessarily. Delivery terms are the specific provisions about how and when delivery occurs. General terms and conditions are a broader set of standard provisions covering payment, liability and other matters. Delivery terms may be embedded in the general terms or set out separately.

- **Q:** How should partial or phased deliveries be handled in the contract?
  **A:** The contract should specify whether partial delivery is permitted, whether each partial delivery triggers a separate payment obligation, and whether the buyer can reject a partial delivery as non-conforming if the remainder is not delivered on time.

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