Negotiate a contract

This unit involves the skills and knowledge required to contract transport and distribution services in accordance with relevant regulatory requirements and workplace procedures. This includes negotiating the contract with a contractor, finalising the contract negotiations, and completing all enterprise contract requirements. Licensing, legislative, regulatory or certification requirements are applicable to this unit.


Work must be must be carried out in compliance with the relevant regulations, standards, legal requirements and codes of practice.

Work is under general guidance on progress and outcomes of work. It requires discretion and judgement for self and others in planning and using resources, services and processes to achieve required outcomes within workplace policy and procedures.

A range of opportunities may be used to develop the work area and to support the development of work systems, innovative strategies to deal with contingencies and to encourage the achievement of the workplace's goals and key performance objectives by the work area and the individuals and teams within it.

The unit generally applies to those with responsibility for resource coordination and allocation and who provide leadership of others individually or in teams.


Not Applicable

Elements and Performance Criteria



1Negotiate contract with contractor

1.1 Requirements of the contract are clearly documented and understood by the relevant parties

1.2 Areas of ambiguity or concern are clarified and resolved

1.3 Negotiations are undertaken with selected contractor for the contracting of required goods/services on a 'without prejudice' basis

1.4 Conditions for service and/or supply of goods/services are agreed between the enterprise and the contractor including the determination of key performance indicators

1.5 Alternative contractors are negotiated with if agreement is unable to be reached with preferred contractor

1.6 Contract negotiations conform to established workplace requirements and relevant legislation

2Complete contract negotiations

2.1 Contract documentation is drafted in accordance with relevant legislation, workplace procedures and negotiated conditions of service and supply

2.2 Technical support in the drafting of contracts is accessed where required

2.3 Contract documentation is signed and exchanged between the relevant parties

3Complete enterprise contract requirements

3.1 Documentation systems are established to ensure traceability of orders and financial transactions

3.2 Workplace systems that require interaction with contractors are identified and actioned

3.3 Quality assurance procedures for supplied goods/services are initiated

3.4 Contract and ancillary documentation is completed and stored in accordance with workplace procedures and, where applicable, regulatory requirements

Required Skills


This describes the essential knowledge and skills and their level required for this unit.

Required knowledge:

Regulations, codes of practice and legal requirements relevant to contractual arrangements

Relevant OH&S and environmental protection procedures and regulations

Workplace procedures for the negotiation of a contract

Problems that may occur during the negotiation of a contract and action that can be taken to report or resolve the problems

Risks that may exist when negotiating a contract and ways of controlling the risks involved

Focus of operation supply arrangements, resources, management and workplace operating systems

Applicable aspects of contract law

Processes for contract formulation and negotiation

Workplace business policies and plans including procedures for maintenance of confidentiality

Equipment applications, capacities, and configurations

Resource availability including the competencies of individuals in the team/group

Relevant contract documentation requirements

Required skills:

Communicate effectively with others when negotiating a contract

Read and interpret instructions, procedures, information and regulatory requirements relevant to the negotiation of a contract

Prioritise work and coordinate self and others in relation to workplace activities

Complete documentation related to the negotiation of a contract

Operate electronic communication equipment to required protocol

Provide leadership and work collaboratively with others when negotiating a contract

Adapt appropriately to cultural differences in the workplace, including modes of behaviour and interactions with others

Promptly report and/or rectify any identified problems that may arise when negotiating a contract in accordance with regulatory requirements and workplace procedures

Apply precautions and required action to minimise, control or eliminate risks that may exist when negotiating a contract

Plan and organise work activities

Monitor work activities in terms of planned schedule

Modify activities to cater for variations in workplace contexts and environment

Work systematically with required attention to detail without injury to self or others, or damage to goods or equipment

Select and apply appropriate technology and information systems

Adapt to differences in equipment in accordance with standard operating procedures

Evidence Required

The evidence guide provides advice on assessment and must be read in conjunction with the performance criteria, required knowledge and skills, the range statement and the assessment guidelines for this Training Package.

Critical aspects for assessment and evidence required to demonstrate competency in this unit

The evidence required to demonstrate competency in this unit must be relevant to and satisfy all of the requirements of the elements and performance criteria of this unit and include demonstration of applying:

the underpinning knowledge and skills

relevant legislation and workplace procedures

other relevant aspects of the range statement

Context of and specific resources for assessment

Performance is demonstrated consistently over a period of time and in a suitable range of contexts

Resources for assessment include:

a range of relevant exercises, case studies and/or other simulated practical and knowledge assessment, and/or

access to an appropriate range of relevant operational situations in the workplace

In both real and simulated environments, access is required to:

relevant and appropriate materials and equipment, and

applicable documentation including workplace procedures, regulations, codes of practice and operation manuals

Method of assessment

Assessment of this unit must be undertaken by a registered training organisation

As a minimum, assessment of knowledge must be conducted through appropriate written/oral tests

Practical assessment must occur:

through activities in an appropriately simulated environment at the registered training organisation, and/or

in an appropriate range of situations in the workplace

Range Statement

The range statement relates to the unit of competency as a whole. It allows for different work environments and situations that may affect performance.

Work may be undertaken:

in various work environments in warehousing, storage, transport and distribution industries

Customers may be:

internal or external

Operations may be conducted:

by day or night

The workplace environment may involve:

twenty-four hour operation

single and multi-site location

large, medium and small workplaces

Services, products, risks, work systems and requirements:

potentially vary in different sections of the enterprise

Contracts may be for:

singular or continuous supply of goods and/or services

Document/data interchange may be:



Clients/customers/suppliers may include:

domestic and international contractors



government agencies

Contract must conform to:

relevant legislation in regard to issues of probity and fair dealings

Consultative processes may involve:

employees, supervisors and managers


suppliers and current or potential clients

legal representatives, financial managers, accountants

relevant authorities, government departments and institutions

representatives of other enterprises and organisations related to the international transfer of freight

industrial relations and OH&S specialists

other professional, maintenance and technical staff

Communications systems may involve:

fixed and mobile telephone




electronic data transfer of information

mail, forms and internal memos

Depending on the type of organisation concerned and the local terminology used, workplace procedures may include:

company procedures

enterprise procedures

organisational procedures

established procedures

Documentation/records may include:

codes of practice and regulations relevant to the transport and distribution contractual arrangements

legal and contract documentation

workplace operating procedures and policies

operations manuals, job specifications and procedures and induction documentation

supplier and/or client instructions

Australian and International standards, criteria and certification requirements

communications technology equipment and oral, aural or signed communications

quality assurance standards and procedures

emergency procedures

relevant competency standards and training materials

QA plans, data and document control

conditions of service, legislation and industrial agreements including workplace agreements and awards

Applicable procedures and codes may include:

regulations and codes of practice relevant to contractual arrangements

Australian and international regulations and codes of practice for the handling and transfer of dangerous goods and hazardous substances

relevant financial regulations

Australian and international standards and certification requirements

relevant state/territory OH&S legislation

relevant state/territory environmental protection legislation

relevant licence or permit requirements and associated regulations

relevant workplace relations legislation

relevant workers compensation legislation

equal opportunity, equal employment opportunity and affirmative action legislation


Not Applicable

Employability Skills

This unit contains employability skills.

Licensing Information

Refer to Unit Descriptor