A distribution agreement, also known as a distributor agreement, is a contract between a supplying company with products to sell and another company that markets and sells the products. The distributor agrees to buy products from the supplier company and sell them to clients within certain geographical areas.
Differences between agency and distribution An agent is appointed to negotiate or conclude contracts on the supplier's behalf. A distributor effectively becomes the supplier and contracts are made directly between the distributor and the customer.
A distribution agreement is a contract between a manufacturer and a distributor. The manufacturer grants the distributor the right to sell its products or services in a specified territory or market.
The term for Distribution Agreements varies, with terms being anywhere from 5 to 15 years. I try to limit the term as much as possible—especially when there is no advance, or a meager one.
Role of Parties: In a licensing agreement, both parties have a closer relationship, with the licensee relying on the licensor's IP rights. In a distribution agreement, the supplier provides the products, and the distributor acts as an intermediary between the supplier and the end customers.
Here are the steps to find and negotiate a distribution agreement: Step 1: Meet with the distributor. Step 2: Discuss the terms of distribution. Step 3: Review the details, such as marketing materials, catalogs, or product literature. Step 4: Hire a lawyer or an expert to draft the agreement.
A distribution agreement, also known as a distributor agreement, is a contract between a supplying company with products to sell and another company that markets and sells the products. The distributor agrees to buy products from the supplier company and sell them to clients within certain geographical areas.