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In a distributor agreement, exclusivity is always an essential aspect. It means that the distributor has the exclusive rights to sell the products of a supplier in a particular area. And during the term of the agreement, the supplier cannot sell the goods in the sales territory.
A distribution agreement is a legal contract between your company and distributors, defining the guidelines to market and sell your products. A distribution agreement grants a distributor the rights to market and sell your company products.
How Distribution Agreements Work Set an appointment with the manufacturer. Negotiate the distribution terms. Review specifics, such as promotional literature. Hire a business lawyer to help you draft the terms. Sign or renegotiate the contract. Begin executing the agreement as contained within provisions.
Key elements of a distribution agreement A distribution agreement should include key elements such as the scope and duration, rights and obligations, termination and dispute resolution, and confidentiality and intellectual property to ensure a clear and mutually beneficial relationship between you and your distributor.
The key terms of a distribution agreement can vary on multiple factors including the: product to be distributed; appointment of the distributor; and. obligations that each party have relating to the marketing, sale and distribution of the product.
A distribution agreement is one under which a supplier or manufacturer of goods agrees that an independent third party will market and sell the goods. The distributor buys the goods on their own account and trades under their own name.
The Distributor Agreement should clearly set forth the duties, responsibilities and expectations of each of the parties. The Distributor Agreement should also set forth provisions related to limitations and protections that each party can understand.
Many distribution agreements contain a clause providing what the distributor gets paid for selling the product, as well as a commission based on the number of products it sells. Commissions give the distributor the added incentive of selling as much of the supplier's product as possible.