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What is a Dealership Agreement?

A dealership agreement is a legal document that sets out the terms & condition of the agreement between a dealer and the Company. This agreement also contains the terms related to transactions with regard to the goods & services they provide. It also binds the parties for a specific tenure , it also specifies the territory, Liabilities and Obligations of both the parties. The party who agrees to purchase the goods from the company for resale to the end users is known as “Dealer” whereas the party who sells its product or goods to the dealer is known as” supplier or the Company.” It is practised to promote the sale and make the product accessible to the consumers at large with a potential to attract more consumers & market.

Why needed?

It is very essential to have a dealership Agreement while entering into any dealership project. It clearly outlines the interest & obligations of both the parties to the agreement. It states the terms & conditions to be followed by both the company/supplier and the dealer with respect to the nature of the agreement along with the roles and responsibilities expected to be fulfilled. In case of any breach of any clause of the agreement the same can be settled off as per the agreed redressal forum mentioned in the agreement, which is mutually decided by the parties to the agreement.