Dated:  XX June 2019

Service Level Agreement

for the provision of

Warehousing Services

between

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx  (1)

&

Lineage UK Warehousing Ltd (2)

& 

Lineage UK Services Limited (3)

Customer and contact information

Customer name					xxxxxxxxxxxxxxx

Contact person					Name
						Job title

Contact details					E-mail address                                                                                                	                                                                                  	Telephone number

Service provider name				Lineage UK Warehousing Limited

Contact person	xxxxxxxxxxxxxx
Business Development Manager

Contact details					E-mail address                                                                                                	                                                                                   	Telephone number 

Additional Service provider name		Lineage UK Services Limited

Contact person	xxxxxxxxxxxxxx
Business Development Manager

Contact details					E-mail address                                                                                                	                                                                                   	Telephone number 

	

Contents

•	01	Statement of intent
•	02	Scope of the agreement
•	03	Agreement duration and location
•	04	Stock / volumes / assumptions
•	05	Rates
•	06	Key service standards 	
•	07	Start-up costs 
•	08	Orders
•	09	EDI / IT development
•	10	Wooden pallets
•	11	Temperature control
•	12	Stock – condition and presentation
•	13	Handball containers
•	14	Product traceability
•	15	POD’s
•	16	Invoice / payment terms
•	17	Paperwork and Reports 
•	18	NetStock system
•	19	Account management
•	20	Review meetings
•	21	TUPE
•	22	Termination due to service failure
•	23	Lien
•	24	Assignment or sub-contracting
•	25	Insurance
•	26	Lineage Warehousing Terms and Conditions
•	27	Confidential information
•	28	Law

•	               Signatures page
•	               Appendices index

Service Level Agreement

This Agreement is strictly confidential between the below named parties.

Customer Name Ltd (1) having its registered offices at; customers address, represented in this Agreement by XXXXXXXX XXXXXXX (XXXXXXXXX Manager) and referred to below as XYZ.
XYZ are listed in the UK with Companies House with Business Registration Number; XXXXXX

Lineage UK Warehousing Limited (2) have its registered offices at; Hareshill Road, Heywood, Lancashire. OL10 2TP, with registered number 556895 and represented in this Agreement by [  ] and referred to below as Lineage Warehousing (with trading name of Yearsley Logistics).

Lineage UK Services Limited (3) having its registered offices at Hareshill Road, Heywood, Lancashire, OL10 2TP, with registered number 11672375 and represented in this Agreement by [ ] and referred to below as TRS.

References in this agreement to “we”, “our” or “us” are references to Lineage Warehousing or, where in this Agreement the context requires, to TRS with respect to the services supplied by TRS.

1.	Statement of intent
•	The above-named parties have agreed the following detail in relation to the required logistics services.  They have also agreed to work together in partnership in order to create the most cost-effective supply chain solution, evolving throughout the length of the Agreement.

2.	Scope of the agreement
•	Lineage Warehousing have agreed to provide all warehouse services for XYZ, in line with the volumes detailed within section 4, these are to include;
o	Receipt, handling and storage.
o	Value added services, to include;
•	XXXXX, XXXXX, XXXXX, XXXXX.
•	The services or any part thereof will be supplied to you by us or by TRS which we may, in our sole discretion decide and allocate. You agree that where the services or part thereof are supplied to you by TRS, payment in respect of such services will be received by Lineage Warehousing on behalf of TRS.

3.	Agreement duration and location
•	This Agreement will continue for X years. The services will commence on the XXs XX 20XX and run up to and including the XXth XX 20XX.
•	A 6 month notice period applies to any termination of this Agreement, this is only applicable as per the below points;
o	6 months prior to the end of the Agreement.
o	After KPI’s are failed continuously as per section 22.
If no notice is issued, or new agreement agreed, then this will become a rolling 6-month agreement until the point the notice is issued.
•	The operations will be managed from the Lineage Warehousing XXXXXXXXXX site. (Postcode)
This site operates 24 hours a day Monday to Friday, with a limited work force covering a 06:00 > 14:00 shift on a Saturday and Sunday.
(All Lineage Warehousing depot opening hours are detailed in the attached Appendix 7)
•	During the term of the Agreement, both parties will continue to carry out supply chain analysis. Through this period, it may come to light that there is an alternative, more suitable location within the Lineage Warehousing network. This would always be discussed and agreed in advance of any movements.
4.	Stock / volumes / assumptions
•	Stock will not be held at any other Lineage Warehousing storage facility unless; the customer has exceeded their storage forecast / the customer consents to an alternative storage location.
•	Where forecasts are breached, Lineage Warehousing may have to move / divert stock to one of its other sites, all costs involved will be charged to the customer.
•	The expectation is not to exceed a 10% variance against forecast.
•	All volumes are to be reviewed and tracked against a rolling forecast in the review meetings.
•	During the term of this Agreement, if volumes vary significantly from above, Lineage Warehousing are entitled to review all rates and amend as required.

•	All agreed rates have been quoted in good faith based upon the volume detail discussed and received, summarised below;
o	XX,000 pallets	(Annual through put volume)
o	X,000 pallets	(Average stock holding)
o	XX%		(Average stock turn)
o	XX,000 cases	(Weekly case pick volume)
o	XXX SKUs	(Average number of live SKUs)
o	XXX pallets	(Annual handball / de-top volume)
o	XXX static pick faces required

5.	Rates
•	All agreed rates including ancillary charges, surcharges and full assumption details can be found within the attached Appendix 1.
•	All warehouse rates include weekend and Bank Holiday working; except for Christmas Day, Boxing Day and New Year’s Day, these are subject to agreement and extra charges.
•	There may be occasions where additional ancillary charges may be applied post receipt; i.e. customer specified rechecks, sample requests, damage segregation. This may appear on a separate supplementary invoice.
•	All rates quoted are fixed for the first 12 months of the Agreement. (Except for electricity surcharge)
•	Both parties undertake to work together to develop initiatives to improve efficiencies in order to negate inflationary pressures.
•	Unless there is a significant change in profile, all rates (except for energy surcharge and any other significant change in cost beyond our control) will be reviewed annually.
•	All rates are subject to annual indexation increases based upon the RPI index every 1st January
•	All rates are based on factors within Lineage Warehousing control, any Governmental or Legislative changes affecting costs will be subject to review accordingly.
•	The electricity surcharge is levied against the weekly warehouse invoice.
This surcharge has a base rate of £52.60 per MWh (Total delivered price)
The calculation is based on electricity being 15% of the gross warehouse costs.
It will be tracked and amended quarterly using the national indices which is part of the ‘Industrial energy price statistics’; GOV.UK Gas and electricity prices in the non-domestic sector.
https://www.gov.uk/government/statistical-data-sets/gas-and-electricity-prices-in-the-non-domestic-sector
Please refer to Appendix 2 for full details in relation to the electricity surcharge.

6.	Key service standards 
•	Please also refer to the detail in section 22.
•	Case fill delivery accuracy (Service level by case – Warehouse); 98% of available cases to be delivered accurately and in full. (Termination clause applies at 97%)
•	Stock receipts: All collected stock to be receipted within 24 hours of collection. All stock is usually booked in within 2 hours of arrival at the Yearsley depot.
The Lineage Warehousing system sends out an auto e-mail acknowledging the receipt and the stock can then be seen and traced via NetStock.

7.	Start-up costs 
•	Lineage Warehousing to be responsible for its own internal standard set up and EDI costs.
•	XYZ will be responsible for all residual stock transfer costs.
•	Initial stock movement costs into Lineage Warehousing from the incumbent supplier would be as agreed between the parties at the commencement of this agreement.

8.	Orders
•	The preferred method for order submission is EDI / electronic file transfer. 
Where this isn’t possible, Lineage Warehousing have developed an order entry portal within the NetStock system to allow customers to enter their own orders. 
The full specification details will be discussed and agreed as part of the account set up process.
•	Where manual orders are requested by the customer these will attract a charge of £1.00 / order.
•	Lineage Warehousing will endeavour to meet orders that have been received outside of the above parameters, but these cannot be guaranteed. A discussion with a Customer Service Representative will be required to agree anything outside of the above standard practice.
This may incur an increased rate, which could involve such items as; staff overtime at £25.00 per man hour which are variable pending timing and destination.
•	At the time of placing orders, all required stock must be in the cold store and showing on the Lineage Warehousing system so it is available to allocate and pick.
If no stock is available at the time of ordering then delivery dates cannot be guaranteed.
Stock not being available could drive additional charges to the customer.

9.	EDI / IT Development
•	Lineage Warehousing commit to the following EDI messaging: Instruction to Despatch, Despatch Advice, ASN (inbound), Goods Receipt, Stock Status amendment (Product Hold/Release and Batch Changes on replenishment).  
•	The cost of EDI development on Lineage Warehousing’s side is to be met by Lineage Warehousing and on the customer’s side to be met by the customer. (If applicable)
•	All other IT development requests need to be discussed in advance and presented to Lineage Warehousing’s IT and Project Managers for review.  Customers are expected to pay for all additional IT developments.

10.	Wooden pallets 
•	All pallets are deemed as one-way trip.
•	Lineage Warehousing is recognised for managed recovery through Chep.
•	Pallets used for handball containers must be purchased or provided by the customer.
•	All pallets presented to a Lineage Warehousing store must be 4-way perimeter-based entry and of sound condition.
•	Standard UK pallets (1,200 x 1,000 mm) are required.
•	Euro pallets can be accepted into most of the Lineage Warehousing stores, as long as they are 1,200 mm wide and in sound condition including full base lats in order to store them across the racking beams. 
•	If stock is destined for one of Lineage Warehousing’s automated sites (Grimsby, Heywood, Hams Hall, Peterborough) then a good quality pallet is required. If a white pallet is utilised then it must be the equivalent specification to a UK Chep pallet.
•	All substandard pallets will be exchanged and charged as per the attached (Appendix 1)
•	The quoted charge rate in Appendix 1 for Lineage Warehousing to supply pallets can be reviewed at any point during the Agreement term. This is due to the variation within the new and second-hand pallet market. Lineage Warehousing’s aim is to purchase a good quality food grade, UK spec pallet at the best possible rate. The charge rate to the customer includes the administration and handling involved.
•	Please refer to Appendix 6 for our required inbound pallet specification.

11.	Temperature control
•	Lineage Warehousing cold stores operate between; -19oC and -21oC.
•	Lineage Warehousing have 24-hour temperature monitoring in place across all sites, alongside onsite engineers that log temperatures daily.
•	All frozen stock must arrive at a Lineage Warehousing cold store with a minimum temperature of -15oC. Stock arriving above this temperature will attract chamber freezing charges which are detailed in Appendix 1.

12.	Stock – condition and presentation
•	A shrinkage allowance of 0.2% of the despatch volume will exist in aggregate between the services provided under this Agreement and related transport services provided under an agreement with affiliates of Lineage Warehousing. 
This will commence from the Agreement start date and be settled annually at each anniversary.
Damages or losses in excess of this figure will be invoiced to Lineage Warehousing at the manufactured cost price.
This tolerance will include any misplaced / lost stock that is subsequently found but cannot be sold at normal prices due to reduced shelf life.  
This allowance is the minimum business standard covering this type of operation.
•	The standard maximum pallet height acceptable is 1.7 metres including the wooden pallet.
At the XXXXX cold store there is a limited number of tall slots available that can store pallets up to a maximum of X.X metres. This must be discussed in advance and agreed before stock can be receipted and stored. Increased storage charges will apply.
The quantity and height of tall pallets has been agreed at; XXX / X.X metres.
Lineage Warehousing have a maximum non- negotiable weight; 1 tonne per pallet.
Where pallets cannot be stored above the agreed maximum height or weight, a de-top operation can be carried out; see Appendix 1 for additional charges that will apply.
The expectation is for all pallets to be clearly marked and have SSCC labels.
Lineage Warehousing cannot accept any stock that has a harsh smell or taint possibility.
No dangerous substances or food not fit for human consumption will be accepted.
All pallets receipted must be in a suitable condition to allow safe handling and storage. This includes; stacking within the confines of the pallet, securely wrapped and a good quality (UK spec) wooden pallet. Where the quality does not meet the minimum standards, the appropriate rework will be carried out and charges applied. This is more relevant when stock is destined to be stored in one of Lineage Warehousing’s automated facilities.
•	One annual stock take is included within the quoted rates structure. Stock takes are based on Lineage Warehousing managing a continuous PPI check across the year then the customer spot checking a small percentage of the current stock annually. Any other significant requests will be chargeable to the customer at £25.00 per man hour.

13.	Handball containers
•	Handball containers must be booked in giving a minimum of 48 hours’ notice. Containers that are cancelled before 12:00 the day before delivery will not incur a charge. Any cancellations after this time will be charged the handball rate per pallet for the number of pallets due to arrive on the container. Also, any containers that arrive over 2 hours late for the booking time will incur double handball charge to cover the direct labour cost.
•	The standard quoted rate in Appendix 1 is based upon; an average of 1,600 cases per container, creating 32 pallets (50 cases per pallet), across a single batch, managed with 3 operatives within a 4-hour period. Requirements outside of this need to be discussed and agreed in advance; as an example, multi batch combinations on one container can significantly increase the offloading time which will in turn increase the standard handball charge.

14.	Product traceability 
•	Lineage Warehousing are to ensure full traceability at pallet level.
•	The customer will advise of the relevant information from which to manage a recall, to include; pallet number, product description, product code, batch number, BBE date, date of receipt and receipt purchase order number (delivery note number)

15.	POD’s 
•	Currently all POD’s are scanned onto the NetStock system so that the customer has access to these on-line without having to request paper copies.
•	80% of all POD’s will be available on line within 24 hours of the delivery; the remainder including those from subcontractors will be available within 5 days. One exception to this is where Lineage Warehousing have utilised a European haulier, this may take up to 14 days.
•	Missing POD’s leading to customers not paying for goods will be treated as stock loss.
•	2018’s developments in this area see the start of the move into electronic POD’s. The aim is to replace all paper POD’s including those managed via subcontract. Please speak with your BDM for further updates throughout the year.

16.	Invoices / payment terms
•	All invoices are raised on a weekly basis covering the previous week’s activity, with the cut off being Sunday 00:01 hrs.
•	All charges covering the ancillary services will be agreed with the customer in advance and will appear on the warehouse invoice.
•	Supplementary invoices may be raised to cover non-standard activity / additional requests.
•	Payments are to be made in full, 30 days from the date of invoice.
•	All payments of invoices will be managed through the Lineage Warehousing ‘Direct Debit Collection’ service.
o	Payments made not via Direct Debit will attract a 2% surcharge.
•	Lineage Warehousing will notify the customer 7 days in advance of the collection amounts. Please refer to Appendix 4 for details.
•	Any disputes are to be notified to Lineage Warehousing within 14 days of receipt of the invoice.
•	All invoices must be paid in full before the total removal of stock from storage, except for any amounts which are in dispute relevant of the time they have been in dispute.
•	Lineage Warehousing reserve the right to charge 5% above bank rate for failed or late payments.
•	Lineage Warehousing reserve the right to place any customer account on Hold due to non-payment.

17.	Paperwork and reports
•	As part of the standard service offering, we provide the following reports, access to paperwork and stock / transaction information;
o	Receipt; Lineage Warehousing’s system can automatically send you a receipt confirmation report via e-mail once all pallets from the inbound load have been located in the cold store. This document, the stock and associated transactions can all be accessed and traced via NetStock. We scan all paperwork associated with the receipt into the system; this can also be accessed via NetStock.
o	Despatch; Lineage Warehousing’s system can automatically send you a despatch confirmation report via e-mail once all pallets from the outbound load have been loaded onto the trailer and confirmed.  This document, the order, the stock and associated transactions can all be accessed and traced via NetStock.
o	Stock reports; Lineage Warehousing’s system can be configured to automatically send you a stock and/or BBE date code report via e-mail at an agreed set day and time of the week. As standard we set this to send at 23:59 each Saturday, but we can change this to suit your requirements and it can also be sent every day if required.
o	On-line access; Over the past few years we have heavily invested in our systems in order to give the customers a first-class service. This includes live access to stocks and transactions as detailed in point 25 below. 

18.	NetStock system
•	NetStock is Lineage Warehousing’s ‘best in class’ live on-line stock and document management system that is provided to all customers.
This is a bespoke system that ensures the smooth transfer of information and product traceability, allowing stock files and reports to be down loaded at the click of a button.

The system and processes allow Lineage Warehousing and the client to work as one.
o	Putting the customer in control;
•	24-hour stock visibility 
•	Manage your own stock remotely 
•	Place stock on QC Hold
•	Release stock from QC Hold
•	Track goods in transit real time 
•	Check POD's online 
•	Analyse information in a format of your choice 
•	Compile your own reports 

•	A user name and password along with full training is supplied to each customer as new accounts are created in order for them to be able to use the system effectively.

19.	Account management
•	As part of Lineage Warehousing’s standard service, you will have 7-day access to a dedicated Customer Service Team based at the Heywood Head Office. 
•	The depot where you store will manage all inbound booking, receipting and stock issues direct.
•	There will also be a Business Development Manager (BDM) covering your account. Their role is to make sure service expectations are managed to the highest levels, look after you as the customer and review processes in order to highlight any cost saving opportunities within your supply chain.
•	Please refer to Appendix 6 for full contact details including escalation.

20.	Review meetings
•	Your Business Development Manager will manage the relationship by way of regular review meetings, these can be monthly / quarterly dependant on the individual customer requirement.
•	There will be a set agenda in place and dates are to be managed 6 months in advance.
•	The agenda, KPI pack, forecast data V’s actual along with an update copy of the previous minutes will be issued 1 week in advance of the meeting.
•	Lineage Warehousing prefer alternate locations for the meetings so that all parties can attend without having to leave their site. This also allows factory / warehouse operations to be viewed as part of the supply chain analysis element.

21.	TUPE 
•	In relation to the Transfer of Undertakings (Protection of Employment) Regulations 2006, no TUPE costs or implications have been taken into account in the formulation of the quoted rates or agreement. The scope of this exemption includes any potential actions, proceedings, claims, expenses, awards, costs and all other liabilities (including legal fees) in connection with the service provision for which we have quoted.
•	If the customer believes there are any potential TUPE implications, they must raise this with Lineage Warehousing immediately.

22.	Termination due to service failure 
•	If the service level falls below the agreed detail, then;

o	Month one – written notification to improve service.
o	A second consecutive month of service failure – final notice to improve service.
o	Third consecutive month of failure – Customer has the right to exit from this Agreement.  

Service
	Agreed Service Level	Level at which Termination Clause applies	
Service level by case - Warehouse	98%	97%	

•	Service KPI’s will be measured on a 5/4/4 Lineage Warehousing accounting period basis. 

23.	Lien
•	Lineage Warehousing shall have a general lien on all goods under its control. This is in relation to covering bad debt through issues / insolvency; so, to give Lineage Warehousing the lien over the stock in its possession equal to the value of the services provided by Lineage Warehousing or its affiliates under this Agreement or related agreements and for which the customer has not paid and are unable to pay. If an invoice is not paid in full on its due date for payment, Lineage Warehousing may, without prejudice to its other rights and remedies, give notice in writing to the customer of its intention to sell or otherwise dispose of some or all of the stock in its possession if the amount outstanding is not paid in full within [14] days. If the amount due is not paid by the expiry of such period, Lineage Warehousing may sell or otherwise dispose of some or all of the stock in its possession, as agent of the customer and at the customer's expense and risk, and shall remit the proceeds of sale or disposal of such stock to the customer after deduction of all amounts due to Lineage Warehousing and the expenses incurred by Lineage Warehousing for the sale or disposal of the stock. Lineage Warehousing shall not be liable for the price obtained for the sale or disposal of the stock.

24.	Assignment or sub-contracting
•	Lineage Warehousing shall be entitled, at its sole discretion and in whole or in part, to sub-contract, assign or otherwise dispose of its rights and/or transfer its obligations (including by way of novation) to any of its Affiliates and may effect any such sub-contracting, assignment or disposal  and/or transfer its obligations (including by way of novation) by entering into such documentation with any Affiliate as they see fit without the requirement of XYZ to sign any such documentation. In the event of any such sub-contracting, transfer, novation and/or assignment, in whole or in part, to any such Affiliate, such Affiliates may enforce this Agreement and Lineage Warehousing may continue to collect and receive all or any portion of the amounts payable by XYZ or any of its Affiliates to such Affiliate-sub-contractor/transferee/assignee under, or in connection with, this Agreement, as agent for and on behalf of such Affiliate-sub-contractor/transferee/assignee of Lineage Warehousing. For the purposes of this clause, “Affiliate” means, in relation to a body corporate, any direct or indirect subsidiary or holding company of such body corporate, and any direct or indirect subsidiary of any such holding company.

25.	Insurance
•	Lineage Warehousing insures all stock to the value of £100 / tonne to cover liability in respect of physical loss or damage to goods outside of the agreed working tolerance.
o	There is an agreed limit of liability, equal to 1 year’s turnover.
•	XYZ need to insure their own stock in storage.
•	All relevant insurance certificates can be supplied upon written request.

26.	Lineage Warehousing Terms and Conditions
•	Lineage Warehousing’s general terms and conditions will be incorporated by reference into this Agreement. This Agreement overrides anything to the contrary in the Lineage Warehousing standard terms of reference. (Copy attached, Appendix 3)

27.	Confidential information 
•	Each party to keep confidential other party’s confidential information. 

28.	Law
•	This Agreement will be governed by English law.

This document has been agreed by all parties.

All below signatures are authorised by their respective companies to act as signatories on the respective companies’ behalf.

Signed on behalf of Lineage UK Warehousing Ltd: ………………………………………………………………………………………………..

Print name: …………………………………………………………………………………………………............................................

Position: ………………………………………………………………………………………………………...........................................

Date: ……………………………………………………………………………………………………………………………………………………..

Signed on behalf of Lineage UK Services Ltd:……………………………………………………………………………………….

Print name :	..………………………………………………………………………………………………………………………………..

Position :	…………………………………………………………………………………………………………………………………..

Date :	……………………………………………………………………………………………………………………………………………….

Signed on behalf of Customers full Ltd name: ….…….……………………………………………………………..………………

Print name: …………………………………………………………………………………………………………………………………………….

Position: ………………………………………………………………………………………………………............................................

Date: ………………………………………………………………………………………………………………………………………………………

Appendices Index

•	Appendix 1 > Rate Matrix

•	Appendix 2 > Electricity Surcharge Information

•	Appendix 3 > Lineage Warehousing Terms and Conditions

•	Appendix 4 > Direct debit letter and mandate

•	Appendix 5 > Contact / Escalation list

•	Appendix 6 > Pallet specification

•	Appendix 7 > Opening Hours