A distributor agreement is a bond between network partners that instructs the tasks of both parties. It is an agreement shared between a producer or vendor and a distributor. In some cases more than one distributor or other personnel are also involved.
It is essential to work out that the documented agreement is exclusive or non-exclusive. In an exclusive agreement, the distributor is the only distributor with all the liability to sell the product within a particular area or in diversified regions. In a non-exclusive agreement, the vendor can opt for other distributors. If a small set of distribution outlets is covering the target markets it is termed as selective strategy of distribution while. An intensive strategy presents the product to several buyers’ via extensive distribution. The intensive strategy is more appropriate to client- leaning items.
The components of distribution agreement are:
- All Terms and conditions. .
- Rights for marketing.
- Specific locations involved
- Termination clauses
- Pricing terms for the Distributor Agreement
- Terms of Payment.
- Procedures related to Ordering and Shipping (risk allocation, etc.) for the Distributor Agreement.
- Inventory and training
- Legal approval
- Warranty issues
A well-written agreement can uplift the business outcome but it is to be kept in mind that every agreement has a life an ill agreement establishes a lawful argument which will create glitches in terms of time and finances therefore it is crucial to draft a well-formatted valid document to overcome any confusion.
Several on-line templates are readily available on free website through which you are able to create a distribution agreement just according to your requirement. Download the appropriate agreement form and proceed further in a legal way.
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