A Distribution Agreement is a legally binding contract between a supplier and a distributor, which outlines the terms under which the distributor may market, sell, and distribute the supplier’s products within a specific territory.

A Distribution Agreement is essential in structuring commercial relationships and ensuring both parties understand their roles, obligations, and expectations.

Whether distributing consumer goods, electronics, medical devices, or software, a Distribution Agreement serves as a roadmap for commercial success—detailing how products are priced, supported, promoted, and supplied.

What is a Distribution Agreement?

A Distribution Agreement grants a company or individual the right to sell a supplier’s goods, usually within a defined region, market sector, or for a particular customer base. In return, the distributor commits to performance targets and marketing efforts, while the supplier guarantees access to stock, pricing, and branding materials.

The agreement will also determine whether the distributor is exclusive, non-exclusive, or sole in a given territory.

When is a Distribution Agreement used?

This type of agreement is commonly used when:

• A manufacturer wants to expand into new markets without building local infrastructure
• A business engages a third party to manage wholesale or retail operations
• A supplier needs to establish clear territory protections or sales targets
• A distributor requires formal licensing to use branding or trademarks

Distribution Agreements are commonly used in industries such as FMCG, technology, pharmaceuticals, automotive, and consumer electronics.

Key clauses in a Distribution Agreement

A professionally drafted Distribution Agreement typically covers:

• Territory and exclusivity
  The specific region and whether the distributor has exclusive rights
   
• Obligations of both parties
  Sales, marketing, technical support, stock levels and more
   
• Prices and payment terms
  How pricing is set, revised, and paid
   
• Intellectual property rights
  Trademark usage and ownership
   
• Minimum sales targets
  Often included as a schedule with KPIs
   
• Termination clauses
  Clear rules for exit or breach
   
• Dispute resolution
  Process to handle disagreements outside of court

All of these elements are included in Bind’s dynamic Distribution Agreement template, which can be tailored to suit any product or market. When the agreement is created you can share, sign and store it within Bind ensuring easy access and security.

Distribution Agreement – free template

This Distribution Agreement (the “Agreement”) is made and entered into by and between:

(1) [Company Name], a company incorporated in [Country], with Company Number [Number], and having its registered office at [Address] (the “Supplier”); and

(2) [Company Name], a company incorporated in [Country], with Company Number [Number], and having its registered office at [Address] (the “Distributor”).

WHEREAS, the Supplier [Add descriptions of goods or services] (the “Products”);
WHEREAS, the Distributor wishes to purchase and resell the Products in agreed territories;
NOW, THEREFORE, the parties agree as follows:

Appointment of Distributor
The Supplier appoints the Distributor as its [exclusive/non-exclusive] distributor in the following territories:

• […]
• […]

Distributor’s Obligations
The Distributor agrees to:

• […]
• […]

Supplier’s Obligations
The Supplier agrees to:

• […]
• […]

4. Prices and Payment Terms
All Products will be sold in [currency], and the Distributor shall pay within [number] days of invoice. Prices may be adjusted with [number] days’ notice.

5. Term and Termination
This Agreement shall run for [number] years from [date], unless earlier terminated. Either party may terminate with [number] months’ notice, or immediately in case of material breach.

6. Confidentiality
All confidential information exchanged shall be protected and may not be disclosed to third parties, even after termination.

7. Intellectual Property
The Supplier retains full ownership of all IP rights. The Distributor may use trademarks and logos solely to market and sell the Products.

8. Dispute Resolution
Disputes will be resolved through good-faith negotiation, and if unresolved, by arbitration in English, at a location agreed by the parties. The arbitrator’s decision shall be final.

9. General Provisions
The Agreement may not be assigned without written consent. Force majeure events excuse delay or non-performance.

10. Governing Law and Jurisdiction
This Agreement is governed by the laws of [Country]. The courts of [City] shall have exclusive jurisdiction over all disputes arising from it.

Signatures
This Agreement has been signed digitally.

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Bind is the easiest way to create a legally binding and commercially practical Distribution Agreement. Start your agreement now with Bind and build trusted international partnerships with confidence.