Most importers have paperwork for every order they have ever placed and nothing at all covering the relationship those orders belong to.
That is not carelessness. It is what happens when the only document in the process is a purchase order, because a purchase order is a transaction. It says what you are buying this time, how many, at what price, delivered when. It is the right instrument for that job — and worth strengthening for it — and the wrong instrument for every question that outlives the order.
Who owns the tooling is not a question about this order. Whether the factory may sell your design to somebody else is not about this order. What happens to your materials, your patterns and your files if you stop working together is emphatically not about this order. Those are relationship questions, and if the only paper you have is transactional, they are being asked of a document that has never heard of them.
What Actually Governs the Relationship
In most importer-factory relationships, honestly, nothing does. What governs it is precedent — how things went last time — plus the goodwill of two people who like each other, one of whom will eventually change jobs.
Precedent is not nothing. It is genuinely how a great deal of trade works, and for many relationships it works for years. The difficulty is that precedent only answers questions that have already come up. The first time something happens that has not happened before, there is no rule, and it gets resolved by whoever has more leverage at that moment.
A supply agreement is simply the standing set of answers, signed once, that every subsequent purchase order inherits. You are not renegotiating tooling ownership on every order. You agreed it once, and each PO sits underneath it.
What It Covers That a PO Cannot
The useful test is whether a term needs to survive the order it was written on.
Quality and what happens when it fails. The standard, who inspects, who decides, what follows a rejection, who pays for rework and re-inspection. A purchase order can name an Acceptable Quality Limit, the sampling standard an inspection is judged against. It cannot really establish a remedy regime.
Ownership. Tooling, moulds, patterns, artwork, digital files, and the right to physically take them. The tooling agreement is the specific instrument here and is worth having in its own right.
Confidentiality, non-use and non-circumvention. Not only that they will not disclose your design, but that they will not use it themselves and will not approach your customers. That is a different promise from confidentiality, and it is usually the one that matters.
Subcontracting and disclosure. Whether work may be moved to another facility, and whether you are told when it is.
Pricing mechanism, as distinct from price. What can move a price, by how much, with what notice and what evidence. This is the clause that turns an annual argument into an arithmetic exercise.
Exclusivity, where relevant, and its limits.
Continuity and exit. How long they will keep producing, what notice each side gives, and what you take with you. Almost nobody writes this down while things are going well, which is exactly when it can be agreed calmly.
Enforceable Beats Comprehensive
This is the part where importers most often spend money and get nothing.
An agreement drafted for a US court, in English, choosing US governing law and US jurisdiction, is frequently unenforceable in practice against a factory whose assets are all somewhere else. Winning a judgment nobody can collect is an expensive way to be right. Many practitioners will tell you that a shorter agreement written in the supplier's language, under the supplier's law, enforceable in a court that can actually reach that supplier's bank account, is worth considerably more than a longer one that is theoretically superior and practically decorative.
Whether that is right for your situation is a question for someone qualified in the relevant jurisdiction. The general point stands: an agreement is worth what it can be enforced for, not what it says.
"We Have Been Working Together for Years"
The most common objection, and the reason many importers never start.
Two things are worth saying about it. The first is that a good supplier relationship is not evidence that an agreement is unnecessary; it is the reason the conversation will go well. You are asking someone who has performed reliably to write down what they have already been doing. That is a much easier conversation than it feels like before you have it.
The second is timing. The best moment was before the first order — alongside the conversation you should be having anyway. The next best is the reorder, because that is when you are asking them for something they want. Introducing a framework in the middle of a quality dispute is possible but hard; introducing it alongside a volume increase is routine.
And if a supplier reacts badly to being asked to commit in writing to what they have been doing for three years without complaint, that reaction is information you did not have before.
What to Leave Out
Agreements fail more often from over-drafting than under-drafting. A fifty-page document sent to a mid-size factory will frequently produce silence, a long delay, or a signature from someone who has not read it, and the last of those is worse than no agreement at all.
The version that gets signed and understood beats the version that covers everything. It is usually better to keep it to the terms that would actually be litigated or relied upon, in language the other side can read, and to leave the rest to the purchase order and the relationship.
The Moral
A purchase order is a receipt for a decision. A supply agreement is the decision.
Most importers have hundreds of the first and none of the second, and then find themselves in a dispute where the only question that matters is one no document addresses. The reason is rarely that anyone thought about it and decided against. It is that the relationship grew one order at a time, and there was never a day when writing it down was the most urgent thing on the list.
There still will not be. That is worth knowing about it in advance.
This is general commentary, not legal advice. Contract enforceability, governing law and jurisdiction differ substantially by country and by situation, and the right structure depends on facts specific to you. Have any agreement reviewed by counsel qualified in the jurisdiction where you would actually need to enforce it.
So — what governs your supplier relationships today: a signed agreement, a set of purchase order terms, or precedent and the goodwill of people who have been doing this a while? And if you had to produce the document that says who owns your tooling, how long would that take?