G. The obligations of the recipient party under this section 6 remain in the event of termination or non-renewal of that contract for a period of [number of years] of years. In order to avoid any doubt, the distributor`s client and negotiator lists are considered protected information under this agreement. If the goods distributed relate to the software and intellectual property of this software, the distribution of the developers is at stake. This mandatory contract between app developers and app distributors allows these developers to license customers when they have used the software. And this approach works for both small businesses and large application companies that include distribution. Our results show that the type of regulation in the wine industry has a significant impact on the structure of distribution agreements between wineries and distributors. Distribution franchise laws, which give distributors greater power over their suppliers, increase the likelihood that wine cellars will use formal and written contracts to regulate their distribution relationships. At the same time, distribution agreements are linked to less complete distribution contracts. Laws that allow direct mailing appear to have a mitigating effect, which reduces the likelihood of formal written contracts, but increases the completeness of distribution contracts. 3 Information on national laws on direct shipping is available from the Wine Institute (www.wineinstitute.org). While rights cannot be shared by the brand under a distribution agreement (as in the case of the Maryland Beer Franchise Act), some states may still allow a supplier to enter into contracts with more than one distributor within the same territory. If this is allowed in its state, a winery should ideally conclude all its distribution agreements for a given territory at the same time and inform each trader.
At least the winery should ensure that the first agreement is expressly described as non-exclusive. Otherwise, the distributor may consider the agreement as an exclusive right in the territory and sue the winery for reducing the distributor`s activities if it were to use a second distributor in the territory. Notes: This table contains the results of a binary logistic regression of the probability of a formal agreement occurring. Regressions are based on a sample of 82 respondents. Legal discontent is a dummy variable equal to 1, so the domain has already legally documented a trader`s discontent. The national law on direct shipping is set at 1 if the state authorizes direct shipment of wine. Similarly, the national franchise law is set at 1 when the winery is distributed to a state with laws on the sale of franchises. The model is appreciated with robust standard errors. Asterisks represent a statistical significance of 1%, 5% and 10% respectively. HHI – Herfindahl-Hirschman Index. Direct shipping provides wineries with an alternative distribution mechanism to reach consumers outside the business without going through a wholesaler (Riekhof and Sykuta, reference Riekhof and Sykuta2005). In 2014, direct shipments from domestic vineyards amounted to more than $1.8 billion and accounted for about 18% of total non-farm wine sales.
Footnote 6 Wineries in countries that allow direct shipping may be less dependent on the traditional three-step system.