Overview – Manufacture, Distribution and Sale of Goods

No business is an island unto itself—each relies on relationships with third parties to operate efficiently and profitably. In every such relationship, the primary business deal as well as the supplementary terms and conditions need to be agreed upon and documented. If this does not take place, then the efficiency and profitability you are looking for may not only be lost, it may be reversed.

Of course the most important aspect of any business is the production and sale of goods and services. While many companies have some combination of manufacturing, distribution and sales capabilities, however, most don’t have a full-service internal operation satisfying all of their needs, and often it would not be efficient or cost effective for them to do so. For that reason, most businesses hire outside parties to perform some of the services they require.

For example, even manufacturers need their own suppliers, so almost every company will need Supply Agreements to operate their business. In addition, even if you have an internal sales team and distribution network, it is rare that they will have the geographic reach necessary to maximize your potential sales. So you will probably want to enlist the help of distributors and/or sales agents that are familiar with local markets and customers. This will require Distribution Agreements and Agency Agreements to be put in place. Finally, the existence of every business depends on its customers, and every sale of a product or service to a customer should carry with it certain Standard Terms and Conditions. This will lead to a more efficiently run business and minimize disputes with your customers.

Let’s now take a closer look at the third-party business relationships and related agreements that will help get your product produced and into the hands of your customers in a manner that gives you the best chance to run a profitable business.

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