Reseller Agreement – 10 Elements to Consider

Before discussing the reseller agreement, I have to give the disclaimer: I am not an attorney–nor do I play one on TV, so I can’t give legal advice. These guidelines are typically reviewed with the attorney so they know the criteria for a reseller agreement.

Reseller Partner Agreement – Use Case Requirements 2023

1. Don’t have in-house attorneys. Many of the partners are small companies – they don’t have an in-house attorney. They see hundreds of these agreements. They are a connoisseur of partner agreements. Anything out of the norm raises a red flag.
2. Layman’s Language. The agreement should always be in layman’s language. If too hard to understand (too long, weird clauses, legalize)–they just don’t sign up–either intentionally, or not then (equals never). They can see it at our portal–they just won’t reply.. We are. too hard to do business with).
3. Do not replicate. If it is in another agreement (EULA), it should not be in this reseller agreement.
4. Electronic. It should be electronic–exactly like the EULA. Paper or even DocuSign is so a decade ago. A click and sign is industry-standard. The exception is 256-bit encryption products with ” do not sell” constraints which may require a signed agreement if required by the government.
5. Standard. Should be standard enough that they do NOT get negotiated–it is too hard to scale if your agreements get constantly changed and negotiated by all your partners. It defeats the advantages of a standard program.
6. Easy in, easy out clauses. Make it easy to join, but also easy to exit the partnership (both sides) – saves a LOT of legalize.
7. Refers to policies. It should refer to your general policies in the portal (you can always give them a temp access account). Then we don’t have to change agreement with simple policy changes.
8. No heavy NDA. Rule: we don’t give partners confidential information (no roadmaps, no code, etc.). They are PAID to talk! So kill all the reverse engineering (in the EULA), or things that only apply to employee’s etc.
9. Standardize. Try to standardize your partner agreement worldwide if possible (taxes, terms not possible, but otherwise yes)
10. Indemnity clause. Should be a general compliance with laws and indemnity – you screw up, you pay, we screw up we pay.

A primary constraint is to cover the bases, but keep it simple and short so they can understand it and don’t feel the need to hire an attorney to review it–or many just won’t come on board (you’re too hard to do business with).

See more at the Chanimal Reseller Agreement page. You can see a sample partner agreement used in hundreds of partner programs HERE. I highly recommend Jeremy Aber if you need help with reseller and SaaS agreements.