Underperformance by agent or distributor
A producer will naturally be concerned if he believes his UK agent/distributor (A) is performing poorly. The standard approach is to suggest that performance targets be agreed every year, and that if A fails to meet them the producer can terminate the relationship. However, experienced agents are likely to be resistant to agreeing "hard" sales targets. It is one thing to have forecasts and to agree to do your best to meet them. It is quite another to lose the business, and perhaps also to forfeit any right to compensation for goodwill that has been built up, if a particular forecast is not met.
A may argue that forecasts may not be met because of circumstances outside his control — e.g. the failure or reorganization of a major customer. Or because of things that are P's fault — e.g. P producing poor quality wine, not having sufficient stock available, being inflexible on pricing, and so on. Furthermore, headline sales figures in a particular period may not be a fair measure of success or failure. Customers recently gained may have substantial potential. The relationship will work best on the understanding that P and A share the same objectives and will each be doing everything possible to achieve them. One party may become disillusioned with the other's efforts and/or approach, but unless the other has committed a repudiation (a clear breach that is so serious that it will bring the relationship to an end if the innocent party so desires) then ............
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