What exclusivity actually covers
An exclusive sales contract should say exactly what is exclusive: which products, which territory, which customers or channels, and whether the manufacturer itself may still sell directly or online. Disputes often begin when a new product line, a large national account, or e-commerce sales were not addressed. The contract should also say whether the seller or agent buys and resells the goods or solicits orders on commission, since the rights and risks differ. For sales of goods, the Uniform Commercial Code treats exclusive dealing arrangements as carrying an implied duty of real effort on both sides unless the parties agree otherwise. Real estate listing agreements that give one broker the exclusive right to sell are a separate kind of contract.
Minimums, performance, and termination
Exclusivity usually comes with performance expectations, such as minimum purchases or sales targets, and the remedy for missing them matters. Losing exclusivity, converting to a non-exclusive arrangement, or terminating the contract outright each lead to very different outcomes. Termination terms deserve close attention, including notice, cure rights, and what happens to inventory, customer lists, and commissions on orders in progress. Some states have laws that protect dealers or sales representatives in particular industries, which can limit termination or require payment of commissions within set periods, so the governing law should be chosen with care.
Competition concerns and drafting
Exclusive arrangements are usually lawful, but they can raise antitrust questions when a party with significant market power uses them to shut out competitors, or when they come with restrictions on resale prices. Cross-border arrangements may also face foreign competition law. Bring the proposed contract, the commercial terms, and a sense of your market share and competitors. We help structure the scope, the performance terms, and the exit provisions so each side knows what it is committing to, and we check whether any dealer protection or agency law will override what the contract says.
