What is not for resale (NFR)?
Not for resale (NFR) is a designation for products that vendors give to their channel partners for testing and educational purposes with the understanding that the channel partner will not resell those products to the end user.
Channel partners, such as value-added resellers (VARS) and solution providers, need to be very familiar with the products they sell and support. This is why vendors will often provide NFR hardware units or software licenses to their channel partners.
Thus, the channel partner may promote products internally for testing and training, but may not resell the hardware units or software licenses.
Why is a not for resale agreement important?
An NFR agreement is important because it helps protect the interests of both the channel partner and the vendor.
For the channel partner, it ensures that they are not violating any terms and conditions when using the product.
For the vendor, it ensures that their products are not being resold to the end user without their permission.
This helps to maintain a good relationship between the channel partner and the vendor.
How does a not for resale agreement work?
When a channel partner receives a not for resale unit or license, it typically has specific terms and conditions associated with it.
For example, the NFR unit may be restricted to use within the company’s offices. In addition, the NFR license may not be valid for use in production environments.
It is important to read and understand the specific terms and conditions associated with an NFR agreement before using the product.
If there are any questions, it is best to reach out to the vendor for clarification.
Components of a not for resale program
A not for resale license is provided through a license agreement between the developer and the distributor.
Through this, the terms of the agreement, including the pricing, internal use, privacy statement (or privacy policy) for the particular NFR program, are clarified. In that way, every new NFR license is different.
For example, the developer might restrict the use of NFR whereby the partner’s subsidiaries cannot access the NFR.
Or the developer can state that internal usage by subsidiaries can be allowed based on the sole discretion of the developer.
When is a not for resale agreement not needed?
There are a few cases where an NFR agreement is not needed.
If the channel partner is not going to resell the product, then they do not need an NFR agreement. In addition, if the product is being given away for free, then there is no need for an NFR agreement.
Finally, if the product is not being used for commercial purposes, then an NFR agreement is not needed.
For example, if a company provides a free trial of their software to potential customers, then they do not need an NFR agreement. This is because the software is not being used for commercial purposes.
On the other hand, if a company provides a free trial of their software to their employees, then they would need an NFR agreement. This is because the software is being used for commercial purposes.
See also: partner program, channel partner portal, deal registration, channel partner rules of engagement and channel strategy glossary.
