How to Write a Sales Agreement

A sales agreement is the contract for selling goods: what is being sold, the price, when payment is due, how delivery works, and who bears the risk if something is lost or damaged. Use it when the deal has terms to negotiate — not when you only need a receipt that ownership changed hands.

Our free sales agreement template covers those terms.

Sales agreement vs bill of sale

A sales agreement sets the full deal (payment schedule, delivery, inspection, warranties). A bill of sale mainly proves that ownership passed at a moment in time — typical for a used car. Use the fuller agreement when there are still terms to fulfill after signing.

1. Describe the goods and the price

Identify the goods by type, quantity, SKU or serial number if you have one, and the purchase price. Vague descriptions ("equipment") cause delivery disputes.

2. Payment, invoicing, and late fees

State when payment is due (on order, on delivery, net 30), how invoices work, and any late fee. If the buyer pays in installments, you can also attach a payment agreement.

3. Delivery, inspection, title, and risk

Say where and when the goods will be delivered, how long the buyer has to inspect them, when title passes, and who bears the risk of loss in transit. These four sentences prevent most shipping arguments.

4. Warranties — or an "as is" sale

Either give a short warranty (goods will match the description and be free of stated defects) or sell "as is" with no warranty. Do not leave this blank; silence creates uncertainty about implied warranties under local sale-of-goods law.

5. Both parties sign

Buyer and seller should sign before goods ship or money moves. Electronic signatures are valid for commercial sales in most places. For a simple order form rather than a full contract, a purchase order may be enough.

Disclaimer: This article is for general informational purposes only and is not legal advice. Sale-of-goods rules vary by jurisdiction.