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  • Beau Schwieso
    • Jun 6
    • 3 min read

Digging Into TAPAs - Trade Agreements and Purchase Agreements

Hello, Dynamics enthusiasts and maybe foodies!


Disclaimer! I may or may not have wrote this while hungry and also missing a witty outlet. You've been warned.


TLDR; Purchase agreement means you're agreeing to buy a certain amount of material. Trade agreement only is agreeing on pricing IF you buy something.


Grab your virtual forks and let’s dive into a delicious topic of TAPAs in Dynamics 365 Finance. We've got a platter of information at your fingertips today so I hope you came hungry. Ok, I'll stop (I won't).


What are Trade Agreements (TAs)?

Trade Agreements are like the all-you-can-eat tapas bar for pricing and discounts. They allow you to set up pricing and discounts for products based on various criteria such as quantity, unit of measure, currency, and more. Think of TAs as your menu of pre-agreed prices and discounts that make transactions smoother and more predictable.


When to Use Trade Agreements:

  • When you need consistent pricing across different customers or vendors.

  • When you want to automate pricing and discounting based on quantities or other conditions.

  • When managing complex pricing structures for sales and purchasing.


What are Purchase Agreements (PAs)?

Purchase Agreements are like ordering a large paella (yes I had to look this up, but it is super good. iykyk) for the whole table. It’s a commitment to buy a certain quantity of goods over a period of time, often in exchange for better pricing or terms. PAs allow you to lock in agreements for future purchases, ensuring you get the goods you need at the agreed terms.


When to Use Purchase Agreements:

  • When you need to secure a steady supply of goods over a period.

  • When you want to negotiate better terms based on committed volumes.

  • When managing long-term procurement strategies.


TAPAs Together – Can You Use Both?

Absolutely! Combining Trade Agreements and Purchase Agreements is like pairing the perfect wine with your tapas – they complement each other beautifully. You can set up Trade Agreements to handle your pricing and discount structures while using Purchase Agreements to ensure you get the volumes you need at those prices.


Using Both:


  • Scenario: You negotiate a Purchase Agreement with a vendor to buy 10,000 units of a component over the next year.

  • Trade Agreement: You set up a Trade Agreement to ensure you get a discount for purchasing in bulk.

  • Purchase Agreement: The Purchase Agreement ensures you are committed to buying the 10,000 units, possibly getting even better terms or secure supply.


Dynamics Dad's TAPA Tips

  1. Start with the Right Base: Just like a good tapa, your agreements need a solid base. Ensure you have clear criteria for when and how to use each type of agreement.

  2. Season Well: Customize your Trade Agreements with the right pricing and discount conditions. Don’t forget to spice it up with tiered pricing and seasonal discounts!

  3. Balance Your Flavors: Balance your Purchase Agreements by committing to realistic quantities that align with your demand forecasts. Too much or too little can spoil the dish.

  4. Serve Together: Using Trade Agreements and Purchase Agreements together ensures you get the best of both worlds – great pricing and guaranteed supply. It’s like serving chorizo and manchego on the same plate – a perfect match!


Dad Joke Time

Why did the Purchase Agreement bring a Trade Agreement to the tapas bar? Because they make a great “pairing” for any business meal!


So, go ahead, mix and match your agreements, and savor the benefits they bring to your business.


Peace, love, and tapas grease,

Dynamics Dad


Bonus: Recipe for ham bechamel croquettes, because who doesn't love fried food??!




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