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What Is A White Label Agreement?
The White Label strategy is one that is being utilised by many businesses — from electronics to foods and software.
The White Label concept involves one business providing goods or services which are then sold by another business under their own brand name.
These arrangements can be quite complex, so it is important to ensure that you have a comprehensive White Label Agreement in place to solidify these deals.
Why Do I Need a White Label Agreement?
A White Label Agreement is a contract between a supplier and a marketer.
It governs the supplier’s production process and also sets out the terms under which the marketer may brand the supplied products.
Whether you’re the supplier or the marketer, it is crucial to have this agreement in place to secure your business deals in New Zealand.
But the White Label strategy is not limited to suppliers and marketers.
For instance, if you are a service provider and engage sub-contractors to help you deliver services (but they operate under your brand name), this is considered White Labelling. And, indeed, you’ll still need a White Label Agreement to ensure you’re adequately protected.
What Is Included In A White Label Agreement?
White Label Agreements typically address the following matters:
- Packaging: How will the supplied products be packaged?
- Defects Rectification: If a product is faulty, is it the supplier or marketer who will rectify any product defects?
- Intellectual Property and Trade Marks: Will the supplier retain the ownership of the product or formulation? Will the marketer have to licence their trade marks to the supplier for packaging and promotion purposes?
- Liability Allocation: If any product defects lead to loss, is it the supplier or marketer who will assume responsibility?
- Non Solicitation: If you’re White Labelling a business’ service, will they have access to your clients? This is where a Non Solicitation clause can protect you.
White Label Agreement Example
Fred has an online shop where he sells health food products that he makes himself. Fred wants to diversify the products he sells, but still wants to ensure customers are receiving high-quality products under his brand.
Fred meets Jess, who makes vegan health food products and he wishes to White Label her products so he can offer his customers a vegan range.
Fred then gets Jess to sign a White Label Agreement. The agreement stipulates that Jess will provide her vegan health food products to Fred. The products will be packaged the same as Fred’s own products, and will have his logo and brand name on the packaging.
This formal agreement is very important to ensure there are no misunderstandings that could potentially damage business relationships.
Need Help With A White Label Agreement?
Having a properly drafted White Label Agreement is crucial — it helps set your expectations with your business partners, secures your payments, protects your intellectual property, and prevents you from facing other legal risks.
If you lack legal experience, it can be challenging to know whether you’ve covered all bases.
Engaging a lawyer to help you draft a legally sound White Label Agreement will provide you with clarity around your engagement.
It’ll also relieve you from the stresses associated with the legal side of the business, allowing you to focus on what you love to do!
If you’re looking for some information or need a White Label Agreement written up, feel free to email us at [email protected] or give us a call on 0800 002 184!
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