A dealership agreement is a written agreement between a manufacturer and a dealer in which the manufacturer agrees to sell the dealer its cars and other vehicles if the dealer buys them at a fixed price. A dealership agreement defines the responsibilities and obligations of each party and is typically for a fixed period. Modify this dealership agreement template to create an agreement to fit your business needs.
This Dealership Agreement is effective as of [Document.CreatedDate] , between:
[Manufacturer.FirstName] [Manufacturer.LastName] , (hereinafter "Manufacturer" or "Distributor"), a company governed under the laws of [Manufacturer.State] , and
[Dealer.FirstName] [Dealer.LastName] , (hereinafter "Dealer"), an individual or business entity located in [Dealer.State] .
WHEREAS, the Manufacturer and Dealer wish to establish a formal relationship through which they will cooperate in selling the Manufacturer's products.
To do so, the parties agree to the following terms:
The Dealer will be the exclusive provider of the Manufacturer's products within the specified (insert area) region. The Dealer will be responsible for marketing and selling the Manufacturer's products within this region under all applicable laws and regulations. The Manufacturer will act as a supplier of the necessary goods and services and will provide all necessary support to the Dealer to ensure the success of their business relationship.
In this section, you may also include information on renewal options or any other relevant details regarding how long or under what conditions the agreement will remain in effect.
This dealership agreement will remain in effect for a period of (insert period, e.g., number of months, a year, etc.), starting from the date of signing. At the end of this term, either party may choose to renew or terminate the Agreement at their discretion. If either party chooses to renew the agreement, all terms and conditions will remain unchanged unless otherwise agreed upon by both parties.
Make sure to cover the details for how pricing will be set, discounts will be applied and any other key terms related to these aspects of the agreement.
The Manufacturer and Dealer will work together to establish a mutually agreeable pricing structure for the goods sold and services provided. The Dealer agrees to offer the Manufacturer a set (insert number)% of each sale, as agreed upon in advance. The Dealer will also receive discounts on any goods or services purchased from the Manufacturer for use in their business.
Warranties help protect both parties involved in the agreement and are essential to any business relationship. Specify what warranties and return policies will be applied and any terms or timelines associated with these aspects of the agreement.
The Manufacturer agrees to provide a standard warranty for all products sold through this dealership agreement, as determined by industry standards.
Define any applicable fees or taxes that may be charged in connection to the agreement. Specify any due dates for these payments and any penalties for late payments.
The Dealer will pay any taxes, fees, or other expenses related to their business activities with the Manufacturer. This includes any applicable licensing fees, sales tax, or import duties. The Manufacturer may also charge reasonable administrative costs associated with the dealership agreement. The Manufacturer must provide the Dealer with an itemized invoice for all applicable fees regularly.
The Dealer agrees to market and promote the Manufacturer's products within their specified territory, using all reasonable means at their disposal. This may include advertising, promotional events, or other forms of marketing as determined by both parties. In addition, the Dealer agrees to abide by all applicable laws and regulations regarding product promotion, advertising, or marketing.
The Manufacturer reserves the right to restrict territories and/or customers for any reason. This may include areas where the Dealer has had a history of poor performance, regions that are deemed too competitive, or specific markets that fall outside of their current business operations.
Either party may terminate this agreement at any time, for any reason, with express written notice to the other party. Upon termination, the Dealer must immediately cease all sales of the Manufacturer's products and return any current or unused inventory to the Manufacturer.
Both parties agree to abide by the terms and conditions outlined in this dealership agreement. This includes all pricing, discounts, warranties, returns, and any other terms or conditions listed here. Both parties acknowledge their understanding and intent to uphold these commitments by signing below.
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There are several important considerations when drafting a dealership agreement, including the scope of the relationship between the parties, any licensing requirements or restrictions, and financial provisions that will govern the distribution of profits from sales.
PandaDoc’s free dealership agreement template can help guide you through the creation process and include all the necessary details to ensure a legally binding document.
A dealership agreement is a legally binding contract between a Manufacturer or Distributor of goods and a third party authorized to sell those goods in a specific region or market. A dealership agreement’s key may include provisions on product pricing, territory exclusivity, advertising requirements, and franchise fees.
A dealership agreement should typically include key information about the product to be sold, such as pricing parameters, advertising requirements, and market exclusivity. It may also contain details about financial considerations such as franchise fees or royalties payments, as well as performance metrics that the Dealer must meet to remain in good standing with the Manufacturer or Distributor. The agreement may include any required contracts or documentation, such as leases or purchase agreements.
The primary difference between a dealership agreement and a Distributor agreement is that a dealership agreement typically involves the sale of goods by a Manufacturer or Distributor to a third party who has been allowed to sell those goods in a specified market or region. A Distributor agreement usually involves the sale of goods by a Manufacturer or Distributor to a third party who will then sell those goods to retailers or other customers.
Another key difference is that dealership agreements are typically shorter, while Distributor agreements may be longer term and can include renewal provisions. Finally, dealership agreements usually contain specific performance metrics that the Dealer must meet to maintain their agreement with the Manufacturer or Distributor, while a Distributor agreement may not include any such requirements.
The formation agreement for a dealership will typically be determined based on the specific needs and requirements of the Manufacturer or Distributor involved, as well as any local laws or regulations that may apply. Some of the factors that may influence this agreement include:
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