AN OPEN LETTER TO THE VAR CHANNEL:
It is DNP's goal to provide the VAR channel with the best possible information about changes in the TTR marketplace. As many of you may already know, there is confusion surrounding whether or not the VAR channel will be allowed to continue participating in the sales and profits derived from thermal transfer ribbons (TTR). This is a serious issue we feel should be officially addressed.
We have received numerous customer inquiries regarding TTR manufacturers selling direct to end users. DNP will not speculate on how or why this is being done; however, we feel it is important to the longevity and vitality of the VAR channel to take these customer concerns seriously.
We have committed the past 10 years to servicing the OEM and VAR channels with the utmost care and attention. In fact, we pride ourselves on our ability to grow with our customers-not at their expense. Simply stated, DNP does not sell direct. We choose to focus our resources on finding new business opportunities for our VARs by creating unique products for vertical markets designed to bring incremental growth to the overall TTR market. In short, we are committed to growing the VAR channel and will do what is necessary to protect that business.
DNP does not and will not make available its drop ship list to any outside or inside sales agency. To further this commitment, we provide-and will continue to provide, our customers with a 'Non-Disclosure Agreement' guaranteeing complete confidentiality when doing business with DNP. Any TTR manufacturer committed to the growth and success of the VAR channel should be willing to offer this same agreement. We encourage you to contact your primary TTR supplier for such agreement.
Additionally, we will do whatever it takes to help you win back any business you feel you have lost due to sales moving from an indirect to direct channel. Call your DNP sales representative today to find out more about what DNP can do to protect your business.
Finally, DNP understands it is one of the only TTR manufacturers not selling TTR direct to the end user in the US, Canada or Mexico. We never have, and we currently have no plans to implement such a strategy.
If you have further questions concerning DNP's stance and commitment to the VAR channel, please feel free to contact me directly at 1.800.814.4672.
Best regards,
Keigo Hayakawa
President
FREQUENTLY ASKED QUESTIONS (FAQs)
About Non-Disclosure Agreements
1. What is a Non-Disclosure Agreement?
A Non-Disclosure Agreement (NDA) is a confidentiality agreement between two parties concerning the sharing of proprietary or sensitive information and/or transactions. It is a legally binding document that, if breeched, can be used in a court of law, where oral agreements often fail.
2. Is there a standard NDA or do I need to create my own?
It is best if you create your own NDA that speaks specifically to your situation. These documents can be either mutual (meaning both parties will disclose or share sensitive information) or one-way (meaning one party gives sensitive information and another party receives that information).
Concerning the resell of thermal transfer ribbons (TTR), it would be in your company's best interest to require a one-way NDA from all TTR suppliers you plan on doing business with. Specifically, in the event you plan on giving your confidential customer database to your TTR supplier. Many TTR manufacturers offer a 'blind shipping' option where the TTR supplier will ship your order directly to your customer. Sharing your customer's information and their buying patterns without having some legal recourse in place is not the best business practice. Especially in the event the market is pressured to sell direct vs. indirect. Having a one-way agreement that guarantees your TTR supplier will not misuse or share your customer database in such an event is a good idea.
3. Why is DNP recommending I get an NDA from all my TTR suppliers?
It is very simple. We respect the VAR channel. While the majority of our efforts are focused on teaching VARs how to grow their TTR business, it is also beneficial to teach VARs how to protect their business.
Protection is the best line of defense and most sound approach in the event a change in the market occurs. Considering the benefits of an NDA in safeguarding the longevity and vitality of a VAR's business, it is only natural for DNP to support these agreements and encourage their acceptance as they secure DNP's number one asset, the VAR.
4. Does the NDA benefit my business, my supplier's business, or both?
It depends on the type of NDA you sign whether it is mutual or one-way. On a basic level, you should consider a one-way NDA to protect your business and your customer's information. Markets change and suppliers are constantly pressured to find more profitable ways to get their products through the distribution channel. There is simply no better way to make sure your current business is safe from your TTR suppliers' sales and marketing strategies.
5. Why would any TTR manufacturer want to sign my NDA?
This is a good question. If the TTR manufacturer truly values your business and your place in the distribution channel, they should be more than willing to prove their commitment to you. Signing an NDA is the best way to do this-especially an NDA that requires your TTR supplier to secure your customer database and prohibits it from sharing your content with internal or external sales agencies.
6. Do I need a NDA to resell thermal transfer ribbons?
You don't have to have an NDA to resell TTR, especially if you never plan on giving confidential customer information to your TTR supplier. However, this agreement is more for your benefit, not your TTR supplier, so the value is clearly in your favor. While many VARs prefer to do business through oral agreements and rely on their personal relationships with their TTR suppliers, these oral agreements do not offer tangible protection in the event your relationship ends and your TTR suppliers decide to do business with your customers.
7. How can I get an NDA?
Pressure your TTR supplier to provide you with an NDA clearly stating your customer information will be kept confidential and will not be used by any inside or outside sales agency. It is important the NDA state this purpose so make sure you request it specifically.
Some TTR suppliers may try to convince you an NDA is not needed and plead with your emotional reasoning; be wary of such suppliers. If a TTR supplier truly values your business, they will be more than willing to offer you an agreement.
8. What should be included in my NDA?
There are five key ingredients to any NDA. They are as follows:
1. Definition or description of the confidential information
2. Clearly defined parameters of or exclusions to the confidential information
3. Responsibilities of the receiving party
4. Duration of the agreement, i.e. time period
5. Other tertiary clauses
9. What does an NDA protect me from?
An NDA is similar to an insurance policy. It is a legally binding document that protects your trade secrets from being shared or used without your permission or knowledge. In the case of reselling TTR, it protects your customer database and information from being used by any inside or outside sales agency associated with your TTR supplier.
Disclaimer
This information is not intended as legal advice. Consult your legal advisors before taking any actions associated with the information stated above as certain facts pertaining to your situation could result in a different outcome than what you expected. This information is based on US laws and the general principals of law within each State; this does not cover all the finer points of law in the various States. Seek counsel on laws that specifically apply to your country or State.
