The newspaper ad, sponsored by a coalition of national manufacturers, pushes all the right buttons: failed businesses, lost jobs, higher prices for consumers and the "destruction of Maryland's business climate!" And the target of this disinformation campaign? A bill in the General Assembly that simply seeks to force manufacturers to give their distributors cause and notice before ending a business relationship.
The aim of this bill is to protect thousands of mom and pop distributors who operate at the whim and pleasure of manufacturers. Since many manufacturers insist on verbal agreements with distributors -- no written contracts -- they can terminate the arrangement at any moment. Local agents are in no position to challenge them. Thus, a distributor is vulnerable to being instantly stripped of his or her livelihood and being left with hundreds of thousands of dollars in unsold inventory.
The bill, sponsored by the Department of Employment and Economic Development, says these agreements can still be broken, but on terms fair to both parties. The manufacturer must give notice and state the reasons for ending the relationship -- and take back the unsold goods and parts.