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A Letter of Intent for Supplier is commonly used in Indonesian business practices as a preliminary step before entering into a formal supplier agreement. This document is particularly relevant when companies are exploring significant supply relationships and need to establish a framework for negotiations while maintaining confidentiality. It typically includes proposed commercial terms, timelines, and conditions for further negotiation, while clearly stating its non-binding nature (except for specific provisions). The document must comply with Indonesian legal requirements, including the language requirements under Law No. 24 of 2009, and should consider local business customs and practices. It's especially useful in complex supply arrangements where due diligence and detailed negotiations are necessary before finalizing a binding agreement.

1. Date and Parties: Full legal names and addresses of both parties, including registration numbers for companies

2. Introduction: Brief statement identifying the parties and their intent to explore a business relationship

3. Purpose: Clear statement of the intended business relationship and scope of potential supply arrangement

4. Key Terms: Overview of main commercial terms being considered (products/services, estimated volumes, pricing principles)

5. Timeline: Proposed schedule for negotiation, due diligence, and execution of definitive agreement

6. Confidentiality: Basic confidentiality obligations regarding discussions and shared information

7. Non-Binding Nature: Clear statement that the LOI is non-binding except for specific clauses (like confidentiality)

8. Duration: Validity period of the LOI and conditions for extension or termination

9. Signing Block: Signature spaces for authorized representatives of both parties