Simply Explanation of Master Agreement
Master Agreement (or Master Service Agreement, MSA) is a contract that defines the general terms and conditions between two parties for future transactions or projects. It doesn’t include specific details like quantity, delivery dates, or pricing for each order — those are defined later in individual orders, work statements, or addenda.
- Sets legal framework (e.g., payment terms, warranties, dispute resolution)
- Allows faster execution of specific projects or purchases under the umbrella
- Reduces repetitive negotiation
- Common in vendor relationships, service contracts, IT, construction, and procurement
- Master Service Agreement (MSA) if it's service-based
Aptien Explains for Business Humans
- A master agreement is a long-term contract that sets the general rules between two businesses so they can work together smoothly on future deals without renegotiating every time.
When and Why to Use a Master Agreement:
- If you work with a single supplier long-term
- If you need to place recurring orders or projects
- If you want to speed up approval for individual projects or purchases
- If you need to set a budget or spending limit for the entire agreement
How Aptien Helps Manage Master Agreements
- Get an overview of your framework agreements with contract management features.
- It also helps you keep track of framework agreement renewal or termination dates.
- See how easy it is to track spending against a framework agreement budget.