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  1. #1
    Ksunya's Avatar
    Ksunya is offline Junior Member
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    Smile in its own name and risk

    Hi!
    Could you please help me to understand the following sentence.
    I am currently trying to translate the contact from english and actually I am not really good in getting some professioanl terms.

    The sentence:
    The Buyer purchases all contractual articles in its own name and risk and cares for own stock according to the sales in his areas.
    Does this phrase mean:in its own name - from the name of my company
    and risk - that my company is responsible for what it purchases,
    i.e. at my company's risk?
    Thank you very much in advance!!
    I am looking forward for your reply

  2. #2
    Anglika is offline No Longer With Us
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    Default Re: in its own name and risk

    At the company's own risk - it will bear the costs of purchase, shipping, insurance and marketing the items.

  3. #3
    Naamplao is offline Senior Member
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    Default Re: in its own name and risk

    Quote Originally Posted by Ksunya View Post
    Hi!
    Could you please help me to understand the following sentence.
    I am currently trying to translate the contact from english and actually I am not really good in getting some professioanl terms.

    The sentence:
    The Buyer purchases all contractual articles in its own name and risk and carries its own stock according to the sales in his areas.
    Does this phrase mean:in its own name - from the name of my company
    and risk - that my company is responsible for what it purchases,
    i.e. at my company's risk?
    Thank you very much in advance!!
    I am looking forward for your reply
    Yes, "in its own name and risk" means the company will own the goods and assume the risk for the sale.

    It sounds to me like this is a clause in a sales distributor agreement.

    The buyer is purchasing the goods from the supplier and reselling them in his designated area. By purchasing and maintaining a stock of these goods he is a stocking distributor. The "risk" is that the goods will not sell. The agreement specifies that the buyer is making his own decision on this matter and they will not accept the return of unsellable merchandise under normal circumstances.

  4. #4
    Ksunya's Avatar
    Ksunya is offline Junior Member
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    Default Re: in its own name and risk

    Thank you very much!
    You helped me a lot
    And yes, it is really the contract of Distribution
    Take care!
    K.

  5. #5
    Ksunya's Avatar
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    Smile Re: in its own name and risk

    Could you,please, help me with one more sentence?
    I can't understand the meaning of it:

    In any case of stock of the Buyer after this period of 3 months both parties assure that they find mutual agreement in good faith.

    This clause is given in the Contract Termination Section.

    Thanks,
    K.

  6. #6
    Naamplao is offline Senior Member
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    Default Re: in its own name and risk

    Quote Originally Posted by Ksunya View Post
    Could you,please, help me with one more sentence?
    I can't understand the meaning of it:

    In any case of stock of the Buyer after this period of 3 months both parties assure that they find mutual agreement in good faith.

    This clause is given in the Contract Termination Section.

    Thanks,
    K.
    It is not clear what is meant by this statement. Perhaps this is a clause whereby the supplier will take back unsold stock within a 3 month period. There is no mention of the terms of the return though. If you want a better answer you should give me the whole paragraph where this sentence is used.

    The sentence is not well constructed as it is shown. The highlighted areas sound funny (odd) to me.

    Perhaps the sentence could be (but this is only a guess).

    Both parties will negotiate in good faith the issue of the Buyer's stock within a three month period of termination of this contract.

  7. #7
    Ksunya's Avatar
    Ksunya is offline Junior Member
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    Smile Re: in its own name and risk

    Well, it sound odd to you, as it sounds odd to me also , I think it is because the contract's draftter is not a native-speaker so he composed this contract relying on his country realies.
    Actually it is the only sentence in this clause, so I can't give you the whole one coz it is the whole clause
    But could , please,you explain me what does to find mutual agreement in good faith mean?
    Thanks,
    Ksu

  8. #8
    Ksunya's Avatar
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    Smile Re: in its own name and risk

    Oh, maybe the previous clause can help you

    In case of termination the Buyer shall be allowed to sell all the contractual articles within a period of three months. After this time it is prohibited to the Buyer to sell any of the contractual articles. The Buyer assures that he avoids any action that damages image of the brands and market price situation.

    And
    The Seller can cancel this contract without any term to give notice in case of...
    Does this phrase mean without explanation?

    Thank you very much in advance!
    Faithfully yours,
    Ksu

  9. #9
    Naamplao is offline Senior Member
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    Default Re: in its own name and risk

    Quote Originally Posted by Ksunya View Post
    Oh, maybe the previous clause can help you

    In case of termination the Buyer shall be allowed to sell all the contractual articles within a period of three months. After this time it is prohibited to the Buyer to sell any of the contractual articles. The Buyer assures that he avoids any action that damages image of the brands and market price situation.

    And
    The Seller can cancel this contract without any term to give notice in case of...
    Does this phrase mean without explanation?

    Thank you very much in advance!
    Faithfully yours,
    Ksu
    This is worded very much in favour of the manufacturer (Seller).

    The Seller can cancel this contract without any term to give notice in case of...

    You did not finish this sentence. You stopped at a critical part.

    without any term to give notice means that the termination will be done without any warning. The "in case of..." are the conditions under which this might be done. Perhaps they might be: non-payment for the goods they purchased from the seller, not working hard enough in their territory (perhaps there is a quota for sales) or some other performance/illegal problem.

    If I were the distributor (he should not be called the "buyer"), and I was terminated in such a manner I would want a clause saying I could return the goods I purchased from the seller and receive my money back. As it stands the seller has 3 months to get rid of his stock but there is no mention of what happens to the leftover stock that cannot be sold in this time period as he is forbidden to sell it anymore.

    Usually in such an agreement there is an "escape clause" whereby either party can terminate their relationship with notice given in a certain time period (three month or six months). There may be situations where the "Buyer" may want to stop selling the "Seller's" product (it may be inferior and too much trouble for what it is worth for example)

    The Buyer assures that he avoids any action that damages image of the brands and market price situation.

    This sentence means that the buyer cannot run to all his customers and tell them that the Seller is canceling their agreement and try to get them (the customer) to buy a substitute product. He cannot talk about the "Seller" in a way that seems (from the Seller's point of view) to damage the Seller's good name and that of his products. (in reality this is hard to do because you as the distributor may be selling other products to the customer and the person/company replacing you may not do a good job servicing this customer...perhaps the customer is loyal and doesn't want to deal with the new person....such situations are messy)

    There may even be a non-competition clause in this agreement later on saying that the "Buyer" cannot sell a competing product for say 1 to5 years after termination.

    There may even be a clause where the Buyer may be forced to tell them who his customers are for the Seller's products.

    Personally I don't think I would like such clauses. I purchased the goods from the Seller for resale. As long as I perform my duty and sell a sufficient quantity of the product the customers' names are my property.

    As I said this document is worded very much in favour of the Seller.

    But could , please,you explain me what does to find mutual agreement in good faith mean?
    Thanks,
    hahaha....this is legal jargon meaning that both parties will be nice to each other and negotiate to a mutually beneficial agreement.

    Remember we talked about risk earlier on the part of the Buyer?

    The risk for a distributor includes:

    Responsible for maintaining sufficient stocking levels for his clients (to provide timely delivery)
    Responsible for the costs of promotion and sales associated with representing the Seller's products.
    Responsible for billing the customers for the goods and collection of the amounts due from their sale.
    Responsible for maintenance and warranty repairs to the products if this is applicable (sometimes this is the responsibility of the Seller...but what if they do a poor job of this...it affects the Buyer's business)

    These are risks to a distributor.

    A sales agent assumes none of these risks.

  10. #10
    Ksunya's Avatar
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    Smile Re: in its own name and risk

    Hey, thank you very much for your help!!! ;))
    Now, I know that after your words, that this contract is worded greatly in favour of Seller, we should add some additional clauses, to make the situation more like win-win
    Thank you for giving me the explanation of all this unknown phrases, especially this legal jargon phrase..in good faith...because after reading it several times the only my desire was to tell...I do! ..hehehehe
    Take care
    Ksu

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