DRAFTING & NEGOTIATING RESELLER & MANUFACTURING AGREEMENTS

RESELLER AGREEMENTS

What Is A Reseller Agreement?

A Reseller Agreement, although similar to a Distribution Agreement in some aspects, is an agreement where a company buys the product from a distributor or wholesaler and then sells directly to end users. A product manufacturer may sell and market products largely through a network of channel partners, which includes distributors, resellers, system vendors, and systems integrators. Product sales channels will vary depending on the products being sold. A distributor often implies a closer relationship with the manufacturer, and a distributor would buy directly from a product manufacturer for sale to end users whereas a reseller would buy from a distributor or wholesaler for sale to end users.

What Is A Distribution Agreement?



A distribution agreement or "distributor agreement" is a contract between a company that supplies products with a company that markets and sells those products. Essentially, the distributor agrees to buy products from the supplier company and sell them to clients within some geographical regions, either exclusively or non-exclusively. Distributors are independent entities who purchase products from suppliers, pay their own business expenses, and either buy the products for resale at a markup or simply process orders, which are placed directly with the manufacturer and earn a commission predicated on placed or completed orders. Suppliers and distributors benefit from the relationship when the suppliers have a product to sell, and distributors are eager to sell or otherwise place orders on suppliers in exchange for a portion of the profits. Distributors get access to a supplier's product line and sales materials to sell the product without the time and expense of research and development. Similarly, suppliers get ready access to a distributor's sale chain and experience for reaching customers. A distributor buys directly from a manufacturer and sells to either resellers or, sometimes, the end-user directly.

A distribution agreement can either be exclusive or nonexclusive. A supplier may authorize a distributor to have exclusive or non-exclusive control over a particular product line, sales channel, or territory. A distribution agreement will contain terms similar to the following:

• Exclusive or Non-Exclusive Agreement

• Geographic Territory for Distribution

• Term and Termination Language of the Contract

• Product Competition Agreements

• Marketing & Advertising Agreements

• Trademark & Software Licensing

• Procurement, Purchase & Sale Terms

• Material Return Authorizations & Credit Terms
  

• Product Liability Limitation

At Wilson Legal Group, our Dallas business lawyers utilize a team-based approach with access to multiple attorneys with substantive years of experience in many practice areas. Whatever your reseller, distribution, or manufacturing needs may be, our attorneys have the talent, resources, and expertise to meet them in an efficient, timely, and cost-effective manner.