Volume Price Agreement

A pricing agreement between buyer and seller that defines different prices based on the actual volume purchased by the buyer over a given period. The technique allows buyers to leverage their aggregate spend even if they cannot accurately forecast precise volumes. From a sales point of view, a volume price agreement can pre-empt negotiations, as the seller can demonstrate that discounts are available to the buyer, but only if linked directly to increases in volume. The setting of the thresholds to trigger a discount and the scale of the discount are usually determined by the seller. See also Logic.

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With over 800 Procurement specific terms (and growing) you will find everything you need to know or thought you knew about the Procurement function. Our aim is to provide you with a comprehensive list collated from the Comprara Groups hub of training and consulting source materials.The Procurement Glossary has been compiled by industry expert Paul Rogers.