Independent Sales Representative Contracts

Written by Sandy Mitchell
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Defining an Independent Sales Representative?

An independent sales representative is a self-employed, independent sales person who agrees to represent a manufacturer's products in exchange for compensation. This salesperson, generally, is responsible for his office expenses, travel cost, taxes, and health insurance benefits. Often, he represents more than one manufacturer with non-competing product lines.

An independent sales representative represents the manufacturer's product line to potential buyers and existing buyers. He instructs buyers on how best to use his product line to increase their own sales. Often, too, he represents the product line at trade shows, craft fairs, and industry conventions.

Typical Inclusions in an Independent Sales Representative Contract

A typical independent sales representative contract spells out the duties and obligations of both the sales representative and the manufacturer. A sales representative generally agrees to accurately present the manufacturer and his product line to customers, to promptly process all leads and orders, to inform the company of any problems in a timely manner, and to maintain contact with the company via telephone, e-mail, or in-office visits. Both parties also agree to give notice, customarily 30 days, of intent to terminate the agreement.

A sales representative contract also spells out compensation. Usually, a manufacturer will agree to pay commission on new sales generated. Sometimes this percentage increases as the sales volume generated increases. In addition, a manufacturer may agree to pay commission, usually at a lesser percentage, on sales to existing customers. Details on commission recalls for returns and cancellations are also made clear.

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