Distribution agreements
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Contact our teamEffective distribution agreements are a crucial part of many businesses’ commercial strategies, helping to expand reach and drive product sales through third-party channels.
Whether you are appointing a distributor to help take your product to market or negotiating the terms and responsibilities of an exclusive or non-exclusive arrangement, having the right legal framework in place is essential.
At Moore Barlow, our commercial and technology law specialists work closely with clients to structure, draft, and negotiate bespoke distribution agreements that support both immediate commercial needs and long-term growth. With a clear understanding of your goals, market, and regulatory landscape, we ensure your agreements are compliant, commercially sound, and tailored to meet the complexities of your sector.
What is a distribution agreement?
A distribution agreement is a legally binding contract between a supplier and a distributor, where the distributor is authorised to sell or distribute the supplier’s products under specific terms and conditions. These agreements set out the roles, rights and responsibilities of each party, including pricing, territory, duration, exclusivity, performance targets, termination clauses, and dispute resolution mechanisms.
There are several types of distribution agreements, including exclusive, sole, and non-exclusive arrangements. Each structure has its own legal and strategic implications, which must be aligned with your wider sales strategy and market position. Whether you are distributing in the UK or internationally, it is important to ensure that your agreement is fit-for-purpose and compliant with applicable regulations, such as competition law.
What are the benefits of distribution agreement?
A distribution agreement offers several advantages for both suppliers and distributors. Key benefits include:
- Market Expansion: Suppliers can access new regions or customer bases without establishing a local presence, helping grow brand awareness and sales efficiently.
- Defined Roles and Responsibilities: The agreement clearly outlines each party’s obligations, reducing the risk of misunderstandings and disputes.
- Legal Protection: A written contract protects intellectual property, pricing terms, and exclusivity arrangements, providing security for both sides.
- Sales Focus: Distributors, familiar with the local market, can focus on selling and promoting the product effectively, while the supplier concentrates on manufacturing and development.
- Cost Efficiency: Using a distributor minimises operational costs such as warehousing, staffing, and logistics, making market entry more affordable.
- Risk Sharing: Risks related to stock, customer non-payment, and market fluctuations can be shared or allocated under the agreement.
- Performance Monitoring: Agreements often include sales targets and reporting obligations, helping suppliers monitor performance and maintain control over their distribution strategy.
Overall, a well-structured distribution agreement supports commercial growth, manages risk, and fosters long-term business partnerships.
How we can help with your distribution agreement
Our experienced commercial solicitors provide practical, commercially-focused advice on every aspect of your distribution agreements. We can assist you with:
- Drafting and reviewing distribution agreements that reflect your commercial needs
- Negotiating key terms such as liability issues, territory scope, exclusivity, and pricing structures
- Advising on competition law risks and compliance, particularly around exclusivity and market sharing
- Managing changes to existing agreements, including termination or renewal provisions
- Handling disputes and enforcing contractual rights, should issues arise
We pride ourselves on delivering advice that is not only legally robust but also aligned with your operational and strategic goals. Whether you’re a manufacturer looking to expand your sales channels or a distributor entering a new agreement, we’ll ensure your interests are protected throughout.
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Why choose us?
At Moore Barlow, we blend top-tier legal expertise with a deep commitment to client relationships. Our commercial & technology team and lawyers are recognised by leading legal directories such as Chambers UK and The Legal 500 and is known for its pragmatic approach, sector knowledge and responsiveness.
We work with a diverse range of clients, from start-ups and SMEs to established national and international businesses, offering a tailored service that reflects your industry and objectives. Our team includes specialists with backgrounds in technology, manufacturing, FMCG, life sciences and more – ensuring we understand the nuances of your commercial landscape.
With offices in London, Guildford, Southampton, Richmond, Lymington and Woking, our regional presence provides clients with accessible, high-quality legal advice grounded in commercial reality. As your legal partner, we aim to build long-term relationships that support your growth and success.
Common types of distribution agreements
Understanding the different types of distribution agreement is key to choosing the right one for your business:
- Exclusive distribution agreement – Grants a single distributor exclusive rights to sell within a defined territory or market segment. Often involves performance obligations.
- Sole distribution agreement – Allows both the supplier and the appointed distributor to sell within the same market or territory.
- Non-exclusive distribution agreement – Enables multiple distributors to operate in the same region, often providing the supplier with wider market penetration.
Each structure carries different legal implications, particularly around competition law and market access. Our team can explain the pros and cons of each approach and recommend the most suitable option for your business goals.
Speak to our commercial team
If you’re entering into a distribution agreement or need advice on an existing arrangement, our commercial solicitors are here to help. We take the time to understand your business and provide practical, effective legal solutions tailored to your needs.
Contact our team today to discuss your distribution agreements and how we can support your commercial goals. We offer clear, strategic advice designed to protect your interests and strengthen your business relationships.
We are here to help
Discover how our expert commercial and technology lawyers can help you.
Contact our commercial and technology team
FAQs about distribution agreements
What’s the difference between a distributor and an agent?
A distributor purchases goods from the supplier and resells them to customers, taking on commercial risks and profit margins. An agent, on the other hand, acts on behalf of the supplier to facilitate sales, typically earning commission but not taking ownership of the goods. Understanding this distinction is important when setting up commercial arrangements.
Do I need a written distribution agreement?
While verbal agreements can be binding in some circumstances, a written distribution agreement is strongly recommended. It provides certainty, reduces risk of dispute, and ensures clear terms around performance, pricing, liability, and termination.
Can I terminate a distribution agreement early?
This depends on the terms of your contract. Many agreements include termination clauses outlining the conditions for ending the agreement early. It’s important to review these carefully and seek legal advice before taking action.
Are there competition law risks with exclusive distribution?
Yes. Exclusive distribution arrangements can raise competition concerns, particularly if they restrict market access or affect pricing. Our team can advise on how to comply with UK and EU competition law and mitigate your legal risks.
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