How can my company make a deal with physical persons and pay commissions from their sales?
Question Details: I am an owner of a U.S. company. I would like to draw up a business development plan for the company, which includes signing contracts with traders who are natural persons who are not U.S. citizens. The main purpose of this agreement is to entitle the persons in question to offer and sell the services of my company in return for receiving commissions on sales and renewed subscriptions attracted by them. Can you help me with this?
The contract is simple: we cannot draft one for you, but any local attorney should be able to; you likely could even draft (draw it up) yourself. The agreement simply needs to indicate:
1) What services they can and cannot offer;
2) Whether they need your approval to "close" the deal or not;
3) Required payment terms they can offer--do they have to get it all upfront? A deposit up front and bill for the rest? Can the whole sale be on credit or account?
4) What information or documentation do they need to provide to you as part of the process.
5) When do they get paid? (Recommended: not until *after* your company gets paid.)
6) What happens in the event you are not paid for a deal? (Recommended: it is written off as a bad debt or negated as a sale and they do not get any commission.)
7) What is their commission rate on new sales? On renewals?
8) Any other terms you feel are important.
You write that they are "natural persons who are not U.S. citizens"--be aware that if they (and/or the customers they bring you) are in foreign countries, it will be VERY difficult to enforce any agreements, whether with the traders or the customers. For example: say you sell services worth $20,000 to someone in another country; after they get the services, they refuse to pay; there is no cost effective or practical way to reach a person in an another nation and make them pay or honor the agreement.