E-Commerce Partnerships Done Right: A Legal Guide for Founders

Moshe Rofeh
May 8
3 min read

Introduction

Joint ventures in the e-commerce space, particularly those involving dropshipping and online marketing, often start informally — between friends, colleagues, or business partners — with a shared idea and complementary skill sets. However, the lack of a formal partnership agreement is one of the leading causes of disputes, business failures, or legal liabilities down the line.

In this guide, we outline the key legal elements every e-commerce partnership agreement should include, with practical tips based on real-world experience from advising entrepreneurs in digital commerce.

Why You Need a Partnership Agreement

A well-drafted agreement sets expectations and clarifies the rights, duties, and obligations of each partner. It helps prevent misunderstandings, and when disagreements arise, it provides a clear mechanism to resolve them.

Even for friends or family, the partnership must be treated as a business venture — with clearly defined responsibilities, ownership, and risk-sharing.

Key Clauses to Include in an E-Commerce Partnership Agreement

1. Roles and Responsibilities

Define who is responsible for what. For example:

Partner A handles website development, logistics, and supplier relations.
Partner B is responsible for content creation, digital marketing, and customer service.

Clear allocation prevents overlaps, inefficiency, and “blame games.”

2. Ownership and Equity Split

Clarify the percentage of ownership and whether it reflects initial investment, ongoing workload, or intellectual contributions.

Will profits be split evenly?
Will one partner be a silent investor with no operational control?

This clause should also specify what happens in case of capital injections or equity dilution.

3. Financial Contributions and Profit Distribution

Specify who invests how much and how profits (or losses) are divided. Address:

Initial funding and ongoing operational expenses.
Reinvestment policy (e.g., 50% of profits are reinvested).
Withdrawal rights.

4. Decision-Making Mechanisms

Define how major decisions are made:

Unanimous vote vs. majority vote.
Tie-breaking process.
Areas where a single partner can act alone (e.g., up to a spending cap).

5. Access to Digital Assets

E-commerce businesses rely on accounts like:

Shopify/WooCommerce
Meta Ads, Google Ads
Stripe, PayPal
Social media handles

Clarify:

Who owns these assets?
Who has login credentials?
What happens if one partner exits the venture?

6. Use of Intellectual Property

Who owns the logo, domain, product designs, and marketing materials?
Can either party use them outside the partnership?

Registering IP and documenting ownership can save considerable trouble.

7. Legal Liability and Risk Management

Dropshipping ventures, in particular, face liability risks:

Trademark or copyright infringement.
Import/export compliance.
Consumer protection violations.

The agreement should allocate liability and establish who is responsible for legal compliance.

Tip: Consider incorporating the business as a company to separate personal and business liability.

8. Exit Strategy and Dispute Resolution

What happens if one partner wants out?
Will the other partner have a right of first refusal?
How are assets, inventory, and profits handled upon termination?

Include a dispute resolution mechanism (e.g., mediation, arbitration, or a designated court).

Summary and Legal Advice

Many entrepreneurs build promising online businesses, only to fall apart due to vague or non-existent legal arrangements. A written partnership agreement not only minimizes legal risk — it builds a foundation of trust.

Our firm has extensive experience advising e-commerce founders on structuring partnerships and protecting their business legally and financially.

Whether you’re launching a dropshipping venture or building a multi-channel online brand — we’re here to help you do it right.

Contact us to schedule a legal consultation tailored to your business goals.