Exclusive Distributorship Agreement

- The Exclusive Distributorship Agreement provides a distributor with exclusive rights to distribute a manufacturer's goods within a defined territory.
- Most manufactured goods can be distributed through a variety of channels such as direct sales by the manufacturer, bundled with other products and sold to an original equipment manufacturer, through an independent sales representatives, and by a traditional distributor.
- Distributor arrangements can be divided into two broad groups:  exclusive arrangements and non-exclusive arrangements.  In an exclusive arrangement, the manufacturer defines a territory, and agrees that only one distributor will be authorized to distribute the products within the territory.  In a non-exclusive arrangement, the manufacturer retains the right to appoint many distributors to distribute the products.
- A manufacturer and distributor will want to consider carefully whether the distributor is granted an exclusive distributorship, and whether the distributor may deal in competing products.  In most cases, manufacturers will desire to avoid prohibitions against dealing in competitive products, as such restrictions may cause antitrust problems.  
- Exclusive distributorships run a somewhat greater risk of violating antitrust laws than non-exclusive arrangements.  This is because the exclusive distributorship is often given in exchange for the distributor's agreement not to deal with competitive products.  
- Manufacturers must take care not to construct arrangements that provide too much control over distributors.  The greater the control exerted by the manufacturer over the distributor, the greater the likelihood that a court may view the relationship as a franchise instead of a distributorship.  

When You Need It
- When you wish to give a distributor exclusive rights to distribute a manufacturer's goods within a given territory.

Getting Started

You will need:
- Name and address of the manufacturer.
- Name and address of the distributor.
- Details of the product to be sold, the territory in which it will be sold, the beginning and ending dates of the Agreement.

When to Review and Revise 
- To correct the information contained in the Agreement.
- To document another exclusive distribution agreement.