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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.
What does Distribution Agreement mean? 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.
Exclusive distribution : In an exclusive distribution agreement, the supplier agrees to sell its products to only one distributor for resale in a particular territory. At the same time, the distributor is usually limited in its active selling into other (exclusively allocated) territories.
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.
An important difference between a distribution agreement and a purchase agreement is that the purpose of the purchase agreement is to transfer ownership of a product, while the distribution agreement is aimed at a long-term collaboration between the parties to resell the products.
In a written distribution contract, there will usually be a right for either party to terminate the contract ?for convenience? by giving a period of notice (such as six or 12 months' notice).
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.
A distribution deal (also known as distribution contract or distribution agreement) is a legal agreement between one party and another, to handle distribution of a product. There are various forms of distribution deals.