Distribution Agreement
Overview
Our Distribution Agreement template is suitable for use when your business wants to appoint a distributor for its products.
- Appoint UK or international distributors.
- Easy to customise Solicitor drafted template.
- Re- use as many times as required and recieve free updates.
Distribution Agreement Template
A Distribution Agreement is used by a supplier of goods or services who wants to appoint a third party to sell the suplier's products in a particular geographic area. This can be a particular country, group of countries or any area that the parties agree upon. The agreement sets out how the parties will work together. Usually the distributor is required to purchase the products from the supplier before selling them on. The agreement is also suitable for use when the parties agree that the distributor will pay for the products only after it has resold them.
A business usually enters into a Distribution Agreement to outsource the distribution process so that it can concentrate on the manufacture of the product. There are advantages and disadvantages to outsourcing your distribution.
If you outsource your distribution, the distributor is responsible for warehousing and transporting your goods. They may know more about the local customs and laws and regulations in the overseas territory where you wish to sell your products, which is particularly useful when seeing to expand into new markets. They will be responsible for any overseas currency risk, for marketing the product and for carrying the credit risk of payment.
The disadvantages are that the distributor will normally want discounts and preferential terms. It is possible to lose control of the marketing and pricing of your product and distributors might want long terms of exclusive sales rights in the territory concerned. However, these issues can be negotiated and dealt with by specific clauses in the Distribution Agreement.
In the Distribution Agreement you can set out the terms that both parties agree to in relation to issues such as product control and pricing. The agreement should cover specific information regarding the agreement you have with the distributor. Any Distribution Agreement should define the geographical territory, whether you are allowed to sell your product directly in the territory yourself, whether you will be appointing any other distributors, what the distributor will be paying for your product and what you will be paying them for their services, including any bonuses. The agreement should clearly state how long the Distribution Agreement will be in effect and whether it can be terminated early by either party.
Using the Distribution Agreement Template
The Template can be downloaded and then edited to fit your requirements.
Once the agreement has been signed by both parties it is a legally binding contract. Changes, unless agreed upon by both parties, cannot be made and will usually require a new Distribution Agreement to be created and signed. You can edit and adapt and then print off the same Template for this purpose. The agreement is based on the laws of England and Wales, but for distribution overseas you may need to make changes regarding jurisdiction, depending on where the distribution will take place.
Clauses in the Distribution Agreement Template
The information listed as necessary for inclusion in a Distribution Agreement can be found in our template. Our template is a standard Distribution Agreement and can be customised to suit your needs. For example, any addendums that need to be added regarding overseas sales can be inserted by you before the agreement is signed.
Associated Documents
We also have an Agency Agreement and a Marketing Agency Agreement template in our Commercial Documents section.
