Distributor contracts are required to efficiently promote products from the manufacturing company to the end consumer. Distributors buy a product from the manufacturer with further sales within a certain territory. The trade can be wholesale or retail. The manufacturer supplies the products, which have a certain marketing concept, and the distributor makes effort to find effective distribution channels. The Distribution Agreement template should clearly regulate the activities of both parties, which deals with the promotion of the products on the market.
It is the distributor’s responsibility to promote the product in the assigned territory, and the products of potential competitors should not be sold. Also, the contract should stipulate the period of cooperation between the parties. When it expires, the contract can be terminated or renewed automatically.
The distributor is an intermediary between the consumer and the manufacturer, so this contract is also an intermediary paper.
Rules applicable to the format of a distribution agreement
For effective cooperation between the parties, the distribution contract sample must contain the certain conditions described below.
The contract must include a clause on the exclusive right to distribute the products in a particular region. Network companies are an exception in this matter.
The agreement should clearly define the boundaries of the territory in which the promotion and sales are to be carried out.
It is also necessary to specify the name of the brand and the list of products to be sold. The main task of the distributor is to establish a sales network, so the agreement should describe the distributor’s powers in this matter. The price policy is most often set by the manufacturer. The price lists are sent to the distributor in the course of cooperation.
It is also important to remember the distributor’s authority to use the manufacturer’s trademark.
Perhaps the most important issue in the contract is the description of the terms of delivery of the goods. The most common version involves partial payment for the products by the distributor or the provision of goods for sale without payment. If we are talking about network marketing, full advance payment for goods is stipulated nearly in any case.
Such a contract may be concluded with entrepreneurs or individuals.
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