PCD Pharma Franchise Agreement Explained - India, today, is the most populous country in the world, with a total of 145.09 crores of people living and is still growing at a tremendous speed daily. This is not a very good thing, as with the rising population, certain problems and risks are also growing at an alarming rate daily, such as health issues related to various risks, including viral, bacterial, seasonal, or any dangerous spreading pandemic, like the coronavirus. This situation has also created various business opportunities for pharma entrepreneurs and franchises.

PCD Pharma Franchises is a very profitable business model and an evergreen sector in India. But this requires certain rules and regulations, mutual understanding between franchise and company and certain ground rules that will ensure a smooth transition of the business. This is done by an agreement signed by both parties. This blog is about the PCD Pharma Franchise Agreement, explained in detail so that you can understand the real deal of the PCD Pharma Franchise.

Breaking Down the PCD Pharma Franchise Agreement

A PCD Pharma Franchise Agreement is a professional contract entered into by the pharma company and the franchise partner, like the distributor/franchisee. The agreement sets out:

The terms and conditions of the franchise partnership.
The rights granted to the franchisee, for example, monopolistic rights in a specific territory.
The duties and responsibilities of both parties.
The legal protection for disagreements, should there be any down the road?
In sum, it creates the structure for a fair and transparent business relationship.

Important Features of a PCD Pharma Franchise Agreement

Listed below are the most important features and points that are the important terms and components of the agreement that a franchise owner or a company owner should know and acknowledge to ensure a healthy deal and business.

Involvded partners

The agreement must state the complete details and bio data of the parties involved in the agreement, that is, the franchise and the company. The agreement states the complete legal details of both the pharma company and the franchise partner. This clarifies who is bound by the agreement.

Details of the Area/ territory for Monopoly

Most agreements grant monopoly rights for a particular territorial area. This helps avoid unhealthy competition among the franchise partners of the same company in the same geographical area.

Diverse Product Range

The agreement should clarify which products are part of the franchise deal. Products may include tablets, capsules, syrups, injections, ointments, or speciality ranges such as derma, cardiac, nutraceutical, or certification, and the franchisees is allowed to choose the desired product so that they can distribute at their will.

Pricing/costing details

The details regarding product pricing, markup, payment methods, credit payments (if any), etc., are recorded to avoid future misunderstandings and disagreements.

Minimum Purchase Requirement

Some companies do enforce a minimum stock order or a target sales amount. If there is an attempt to set paid requirements, it assures commitment and partnership to grow the business from both parties.

Promotional Support

The agreement could include different promotional inputs provided by the pharma company, including visual aids, samples, visiting cards, brochures or digital marketing support, etc.

Duration and Renewal

The terms of the agreement is usually range for 1-5 years, depending on both parties and at what period they agree upon. It is very important to mention the agreed-upon time in the agreement to avoid any future disputes

Required Documents for the Agreement

Here is the list of the required documents needed for the agreement and to ensure the process is legal and the legitimacy of the parties involved, and to avoid any fraud.

Agreement for Manufacturing.
Certificate for Non-Resemblance
An attested copy of the Drug Licenses is needed to be submitted
Attested a copy of the GST Registration Certificates.
PAN card, Aadhar Card, GST Registration
An attested copy of the Drug Licenses is needed to be submitted.
For Limited companies, a copy of a Resolution for an Authorised Signatory.
Partnership deed of the Partnership firm.
Affidavit for a Proprietorship firm.
Profile of the Company, including the Name and address of all directors, stating telephone numbers, both official and residential, Partners or Proprietor

Responsibilities of the Parties Involved in Agreement

Here is the list of the responsibilities of the franchise and the franchisor/ Company that are involved in the agreement:

For Franchise

Distribution
marketing and sales
Stock maintenance and availability
Financial report and management track.
Minimum quantity or product must be specified

For Company

Manufacturing of the products and supply
Product quality
Training and promotion
Monopoly right assistance.

Conclusion

If you are looking to start your franchise business in PCD pharma, then it is very important to understand the terms and conditions and the minute details that are required to sign an agreement. To do that, you must be searching for a PCD Pharma Franchise Agreement Explained details that can help you to go into the roots of the agreement. This blog contains all the required information about it and can help you in drafting a legal and best agreement to ensure a smooth and healthy agreement.