A commercial business partner helps your business sell, distribute or market your products or services — without it being an acquisition or a merger.

Short answer: Commercial partnership is an umbrella term for agreements where two businesses collaborate on sales, distribution or marketing for mutual benefit — from a simple agency agreement to a closer distributor partnership.

The most common forms

  • Agency agreement — an agent sells on your behalf for commission, without owning the goods themselves
  • Distributor agreement — the distributor buys and resells at their own risk
  • Cross-selling — two businesses recommend each other's products to their respective customers
  • Co-branding and joint marketing — you market together to reach a wider audience

How do you choose the right form?

The more control you want over pricing and the customer relationship, the more that argues for an agency agreement over a distributor agreement. The more you want the partner to invest in selling the product themselves (because they've taken on the risk of owning the goods), the more that argues for distribution. See the full walkthrough of both models in distributor agreements: the big guide.

What should you agree on?

Commission or margin, geographic or industry exclusivity, minimum sales, and notice period are the most important points in any commercial partnership agreement — regardless of which form you choose.

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