Distributorship Agreement Checklist

When you`re looking to start or expand a business, partnering with a distributor can be a great way to get your product out there. However, before you sign on the dotted line, it`s crucial to make sure that your distributorship agreement is thorough and covers all the necessary details. Here`s a checklist of what should be included in your distributorship agreement:

1. Territory: Clearly define the geographic area that the distributor will be responsible for selling your product in. Will they have exclusive rights to a specific region? Can they sell the product online?

2. Products: List out the specific product(s) being sold and any restrictions or limitations on what the distributor can do with them. This can include things like pricing, marketing materials, and packaging.

3. Payment terms: Outline the payment structure for the distributor, including commission rates and how often payments will be made. Specify any penalties for late payments or non-payment.

4. Sales targets: Set realistic sales goals for the distributor to meet and include consequences if those targets are not met, such as terminating the agreement.

5. Intellectual property: Protect your intellectual property by including clauses on trademarks, patents, and copyrights. Make sure the distributor knows what they can and cannot do with your branding.

6. Termination: Include language outlining the conditions under which the agreement can be terminated, by either party. This can ensure that both parties are protected if something goes wrong.

7. Warranty and liability: Clearly define who is responsible for any defects or damage to the product, as well as how warranty claims will be handled.

8. Confidentiality: Include a confidentiality clause to protect your trade secrets, customer data, and other sensitive information.

9. Dispute resolution: Outline your preferred method of dispute resolution, whether it be arbitration, mediation, or taking the issue to court.

10. Governing law: Specify which state or country`s laws will govern the distributorship agreement.

Having a distributorship agreement checklist can help ensure that your agreement is comprehensive and covers all the necessary bases. By taking the time to carefully review and negotiate the terms of your agreement, you can help protect your business interests and build a successful partnership with your distributor.