They may also include a non-competition clause that prevents the employee from working for a competitor until a reasonable period of time expires. This will prevent the representative from sharing confidential information with your competitors. Second, the duties and responsibilities of the representative are clearly defined. Examples of these responsibilities may be as follows: most companies have a sales team to increase revenue through new and repeated transactions. To effectively manage a sales team, many companies use a trade agreement that defines the operating framework of a sales team. Each agreement of distributor representatives should have seven important provisions. If you decide to set a sales quota for your representatives, you should also include this information in the agreement. Past performance is often a good indicator of reasonable minimum expectations for revenue targets. The first point that needs to be clarified in a distributor representative contract, even if it has already been discussed, is whether the representative is an independent contractor or a staff member. The termination rules vary according to the Landers. While some states allow a distributor contract that gives your company the power to terminate distributor contracts at any time, other states require employers to give up to 90 days` notice.
Check state rules before writing your sales contract or terminating an existing agreement. Be sure to specify the prohibited actions to the agent. Here are some examples: In addition to these main provisions, there are several other clauses, such as the choice of law and predictability you should include, so be sure to speak to your lawyer before concluding your distribution representative agreement. You can also specify other restrictions, for example. B where products can be sold. Representatives may be limited to a particular region or type of customer. You can attach a list of existing clients that the representative can contact. Smart contractors will ensure that the contract is clearly terminated. The basis for dismissal may be “for reasons” or “for convenience.” An example of termination “for a good reason” would be that the salesperson does not respect the quotas. An example of “convenience” would be for the company to decide that it no longer wants to use the agent`s services. In both scenarios, a clear termination process and appropriate notification provisions should be put in place.
Below are more details on the seven clauses that should be included in your commercial contracts. The agreement should also indicate how often your company will send statements to the representative about the status of the commission account and will give the representative some time to object to the content of the statement. A commercial agreement ensures that your sales agent transmits your product to your target customer at a fair price and in the right places.