What is contract price adjustment clause in SAP ORG-LX-T9N - Team: Corporate Translation?

SAP Term: contract price adjustment clause

• Component: ORG-LX-T9N

• Component Name: Team: Corporate Translation

• Description: A provision in a contract that adjusts a price over time by linking it to the change in some related objective measure, such as a wage-cost index or the market cost of a commodity.

Smart SAP Assistant

• Key Concepts: 
  A contract price adjustment clause is a provision in a contract that allows for the prices of goods or services to be adjusted based on certain conditions. This clause is typically used when the prices of goods or services are expected to fluctuate over time. It allows for the contract to remain in effect even if the prices change.
  
  How to use it: 
  Contract price adjustment clauses can be used in a variety of contracts, including those for purchasing goods or services, leasing property, and providing services. The clause should specify the conditions under which the prices can be adjusted, such as changes in market prices or changes in the cost of materials. It should also specify how often the prices can be adjusted and how much they can be adjusted by.
  
  Tips & Tricks: 
  When drafting a contract with a contract price adjustment clause, it is important to ensure that the clause is clear and unambiguous. The clause should also be tailored to the specific circumstances of the contract, as different contracts may require different conditions for price adjustments. Additionally, it is important to ensure that both parties understand and agree to the terms of the clause before signing the contract.
  
  Related Information: 
  Contract price adjustment clauses are similar to indexation clauses, which allow for prices to be adjusted based on changes in an index such as inflation or a currency exchange rate. Additionally, some contracts may include escalation clauses, which allow for prices to be increased at regular intervals without requiring any additional negotiation between the parties.