Dealership Agreement What Is

A dealership agreement is a legal contract between a dealership and a manufacturer or distributor of products. This agreement outlines the terms and conditions that the dealership must follow in order to sell the manufacturer`s products, as well as the responsibilities of both parties.

The dealership agreement is an important document for any dealership that wants to sell a manufacturer`s products. It provides the dealership with the right to use the manufacturer`s trademarks, logos, and other intellectual property, and sets out the dealership`s obligations in terms of marketing and promoting the manufacturer`s products.

One of the key provisions of a dealership agreement is the exclusivity clause. This clause requires the dealership to sell only the manufacturer`s products, and not to sell products from competing manufacturers. In some cases, the exclusivity clause may also require the dealership to purchase a certain minimum amount of the manufacturer`s products each year.

Another important aspect of a dealership agreement is the termination clause. This clause specifies the circumstances under which the manufacturer can terminate the agreement, such as if the dealership fails to meet sales targets or breaches the terms of the agreement.

In addition to these provisions, a dealership agreement may also address issues such as warranties, product returns, and advertising requirements. These provisions are designed to protect both the manufacturer and the dealership, and to ensure that the products are sold in a manner that is consistent with the manufacturer`s brand image.

Overall, a dealership agreement is an essential tool for any dealership that wants to sell a manufacturer`s products. By outlining the terms and conditions of the relationship between the dealership and the manufacturer, the agreement helps to ensure that both parties are on the same page and working towards the same goals. If you are thinking about becoming a dealership, it is important to carefully review any dealership agreement before signing it, and to seek legal advice if you have any questions or concerns.

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