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In this video, Simon from The Contract Company discusses the essential clause that every distributor seeks in a distribution agreement: exclusivity. He explains that when a distributor engages with a supplier to market and sell goods, securing exclusive rights is crucial. This exclusivity ensures that the distributor is the sole party allowed to distribute the supplier's products in a designated region, preventing the supplier from partnering with others in that area. By obtaining exclusive rights, distributors can invest time and resources into marketing the brand without competition from other distributors or the supplier itself.