Marketing expert witness Glen Balzer is a widely published author on distributor and representative relationships and agreements, as well as sales organizations and commissions. Here he writes on traits of successful representative agreements.
Suppliers and manufacturers’ representatives often seek to gain advantage over their partners by incorporating a bias into the representative agreement favoring the author, placing the other party at a disadvantage. This technique rarely enjoys the benefits intended. The best agreements set balance as an objective between supplier and representative. If the relationship begins with a biased agreement, that bias works against development of a solid relationship. Since the agreement is the foundation of the partnership, it must flourish with words and phrases that elicit a spirit of trust and cooperation.
Each clause of a representative agreement should seek to strike a balance between the power of the supplier and the manufacturers’ representative. If there is a clause of indemnification protecting the supplier for a specific set of conditions, there should also be a clause protecting the representative on a different set of conditions. If there is a paragraph outlining the duties and obligations of the representative, there should also be a paragraph outlining the duties and obligations of the supplier. A unilateral phrase only works to the ultimate distrust of one party by the other. Distrust always works against development of the relationship and ultimately against sales, growth, and profits, the original purpose of the relationship and the agreement.
More to follow from Glen Balzer.