The term “distributor” was borrowed in English (to distribute – to distribute), because in Russian there is no word that would fully and clearly reveal this concept. A distributor is an individual entrepreneur or a large company that purchases goods directly from the manufacturer for the purpose of further distribution to dealers or small wholesalers in the region, which carries out its activities at its own expense. The product can be anything: from products, machinery, cars to copyright and technology.
Features of the distributor
A distributor is a kind of intermediary between the manufacturer and the retailer, the dealer or the buyer. His income is realized at the expense of the difference between the large discount from the manufacturer and the markup when selling the goods. For Sephora – Sell to Sephora this is important.
The principal difference from the dealer is the sale of the goods directly on behalf of the manufacturer. This division is very conditional, since it is not prescribed by law, and is established by agreements. In addition, the distributor is not liable for the quality of the goods, but only mediates between the manufacturer and the dealer, and the dealer is already responsible to the buyer, so becoming a distributor in your region is quite simple.
The distributor can be:
General – an importer company that sells products in its own country by its own forces or through dealers;
Exclusive– the transfer of the right to distribute the goods to the distributor only within the agreed territory and without third parties. In this status, the distributor undertakes to cooperate only with one producer and with no one else.
- The chain of distribution of goods and services can be either long or short. A multi-structure scheme is most common for foreign companies due to multistage delivery to the domestic market. Such a chain can look like this: producer – distributor – intermediaries – buyer.
- For example, a distributor who purchased a large consignment of goods abroad is in the capital and entrusts it with sales to dealers located in different regions, which, in turn, can also sell goods through other intermediaries. In a short scheme, the link “intermediary” is absent and it is more typical for the production and sale of goods in the territory of one country.
It is the responsibility of the distributor to find suppliers for commodity sales, as well as to promote products and search for potential buyers.
Most often, large companies themselves establish their own distribution companies. One manufacturer can have any number of distributors, just as one distributor can have an unlimited number of suppliers. Need to know more? Visit to Retail distribution.
How to become a distributor without investments in your region
With the introduction of the Internet, it became easier for potential distributors to start their own business, as here you can find all the necessary information.
Before becoming a distributor of the manufacturer, decide what kind of product you want to distribute: food, tea / coffee, household appliances, electronics, household goods. To do this, carefully study the ratio of supply and demand for goods and services in your region. If you are not sure which product you want to work with, enter “a distributor is required” in the search bar and examine the available offers. In addition, the search for a suitable manufacturer can be done through business directories.