Who is a distributor and is he an extra link?

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

This borrowed from English word came to Russia with the beginning (return) of capitalism. The easiest way to answer the question, who is a distributor, is with a translation - this is a distributor. To be more precise, it can be an individual (individual entrepreneur) or a legal entity that provides intermediary services in the supply of products from the manufacturer (starting point)

to resellers (resellers) and ultimately to the direct buyer. How else can you characterize who a distributor is and what he does? First of all, he is a representative of the manufacturing company in a certain territory. That is, it is engaged in building a distribution channel, establishing a network, and not retail. This is its difference from the reseller. The scale of both the network and the entrusted territory can be very different. It all depends primarily on the product. The more it is massive, in demand, the morehe has competition, so the scope of the distributor (by the way, according to the Dictionary of 2007, the form "distributor" is also allowed) is already more concentrated. Take this example: a manufacturer of juices (dairy products, bread, etc.)

is interested in having its product in all retail chains, in small shops, kiosks, supermarkets and shopping centers. Therefore, the channel must be wide and branched. And who is the distributor in this case? This is a wholesaler that establishes relationships with retailers, deals with pricing policy in a particular city and / or region, monitors and organizes advertising and promotions, positioning, display. At the same time, it can work both for one manufacturer and promote products from different manufacturers. He may or may not work in his own name. But it is he who is responsible for warehousing, bulk purchases, pricing in the region.

Take another example to illustrate what a distributor is. Suppose a manufacturer is engaged in the production of banner fabrics for large-format printing on five-meter printers. How many final customers can he have, if such machines are extremely rare, they are available at best at one advertising production plant in a metropolis?

In this case, it is more expedient for him to entrust the distribution of his products to a distributor for an entire country or several regions at once. And there is no point in promoting it through multiple channels, becausethe demand for such a product is selective and episodic.

Often, distributors of auto parts, plumbing, complex machines work for a commission. For them, a certain volume of sales per region (country, district, city, network) is assumed. When they complete it, they can count on bonus rewards. But it is the distributor who is responsible for receiving money from the end buyer, and often the evaluation of his work is made only after the calculation of the annual turnover and paid invoices. The position of the manufacturer, in general, is clear. He wants to supply large quantities and not think about advertising, discounts, debts, or the local market. All worries should lie on the shoulders of the distributor. It is he who will have to decide how, in what form, from what budget to advertise the product, to whom it is possible to provide a loan, and from whom it is necessary to take an advance payment. It will also be his concern where to store the products before delivery to the store (or to the client). Therefore, the search for distributors who are competent, able to build a channel, long-term partnerships with retailers is not such an easy task. But it is on his activities that, ultimately, the reputation of products in this region depends.