WHAT IS A DISTRIBUTION AGREEMENT?

A distribution agreement is a legal document between a manufacturer or supplier and a third party for the marketing and sale of its goods to consumers. The distribution agreement will set out the terms and conditions governing the relationship between the parties, including geographical areas the third party can operate, terms outlining pricing and payment options, term length of the distribution agreement, minimum order values, intellectual property rights, termination clauses, and competition restrictions, if applicable. Distribution agreements may be exclusive or non-exclusive. In an exclusive distribution agreement, the manufacturer may authorize a specific retailer to sell their product in a specific geographical location. In a non-exclusive distribution agreement, multiple retailers may be able to enter into a distribution agreement with a manufacturer for the sale of their products. Distribution agreements may be advantageous for manufacturers, as they allow the manufacturer to focus on manufacturing and advertising their product without worrying about the sale of the products. If you are a manufacturer or retailer looking to enter into a distribution agreement, it is recommended to consult with an experienced business lawyer to draft or review the distribution agreement.

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Disclaimer: The information contained in this article is not to be construed as legal advice. The content is drafted and published only for the purpose of providing the public with general information regarding various real estate and business law topics. For legal advice, please contact us.