An exclusive agreement precludes multiple distributors.
An exclusive distributor agreement stipulates a distributor and a manufacturer have an exclusive arrangement for distribution of certain products for a proscribed area and/or time. Such agreements may play out in additional ways as well, giving a distinct nature to business relationships.
Scope
A distributor's exclusive right to sell a supplier's goods usually comes with limitations, as economic analyses of vertical agreements notes. These limitations stipulate that while a distributor may be given exclusive rights within a geographical area, outside that area the exclusive agreement would not apply.
Considerations
With rights come responsibilities. When a seller gives a distributor exclusive rights for a territory, the distributor then has the responsibility of putting forth best efforts in selling the distributed product, according to "Export/Import Procedures and Documentation." Including a minimum purchase amount in the agreement will further protect the seller's interests.
Specialty
Inventors with a patented product may offer an exclusive license agreement to a distributor, giving her sole distribution rights for a designated time. However, under this agreement the ownership rights remain with the inventor.
Tags: distributor exclusive, exclusive agreement, exclusive rights