Reselling might be beneficial for all kinds of products or services. Not only luxury product brands may benefit from resellers, all kinds of products and services can be sold under a reseller agreement. For example, a SaaS provider might benefit fromthe selling expertise of a reseller. Even webhosting can be sold by resellers: A party offers large packages of data traffic and storage to resellers. The resellers, in turn, break these down into smaller packages which they then sell at a competitive price. This means that the reseller does not require its own infrastructure, while the ultimate provider only has to conduct business with a select number of clients.
Resellers conclude their own contracts with clients, even if the services are provided by the ultimate provider. The reseller’s clients cannot simply turn to that provider in the event of damages or other claims. This is a fundamental difference with agents and affiliates, where the ultimate provider itself enters into contracts with clients. A good reseller agreement is vital to avoid conflicts between the parties. The following points require special attention:
A matter that is often subject to discussion in reselling is whether the ultimate provider may take over reseller’s clients if the contract with the reseller is terminated. This is not standard procedure, since these clients do not have a contract with the provider. If the provider wants this, it should be explicitly included in the reseller agreement.
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If a company is unable to serve the entire market itself, it can engage agents or representatives to sell products or services on its behalf.
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