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A distributor agreement is a contract between a manufacturer or supplier and a distributor who agrees to sell the products or services to end customers. It outlines the terms of the relationship, including pricing, distribution territories, and other important details.
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Expands product reach and market coverage through distributors.
Ensures product availability and visibility in different territories.
Defines pricing, payment terms, and delivery requirements.
Establishes performance expectations and sales targets.
Helps build strong partnerships with reliable distributors.
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The terms regarding competition and exclusivity can vary in distributor agreements. Some distributor agreements may include provisions that restrict the distributor from selling competing products, while others may allow the distributor to sell a range of products, including those of competitors. The terms should be clearly defined in the agreement.
The transfer or assignment of a distributor agreement to another party typically requires the consent of all parties involved, including the manufacturer or supplier. The agreement should outline the conditions under which such transfers or assignments may occur.
Distributor agreements often include provisions related to sales targets or minimum purchase requirements. If a distributor fails to meet these targets, the agreement may outline potential consequences, such as reduced territory exclusivity, termination, or other remedies specified within the agreement.
Unless otherwise specified in the agreement, a distributor is generally restricted from selling products outside their designated territory. However, the agreement may include provisions for exceptions or allow for discussions and amendments to expand the territory if mutually agreed upon.