Table of Contents
What is one responsibility of a distributor?
As a distributor you will organise the storage and distribution of goods. As a part of this role you will ensure that the correct products are delivered to the correct location on time and at a good cost. You may also be involved in transportation, stock control, warehousing and monitoring the flow of goods.
Can distributor sell to end user?
Normally, distributors apply a modest mark up and re-sell those products to integrators. Integrators then mark up the product again, bundle integration services and sell to the end user. When distributors sell direct to end users, they can sell for a significantly lower price (while maintaining their profit margins).
Why are distributors needed?
Distributors play a vital role in keeping the lines between manufacturers and users operating smoothly. They can expedite response times, enhance a company’s reach and even create value-added packages.
What information must a distributor supply?
The main obligation on a distributor is to supply a safe product. In particular you must act with due care to help ensure only safe products are supplied and must not supply products that, as a professional, you know (or should have presumed on the basis of information in your possession) to be dangerous.
How do you reward a distributor?
- Provide incentives for satisfactory performance. The oldest but most effective method of motivating distributors is to give them a challenging but realistic target and to reward them for reaching it.
- Listen to their needs.
- Arm them with the right sales materials.
- Avoid stealing business from your distributors.
What is the difference between a distributor and a customer?
Most companies describe their “customers” as people who buy products and services from them. Distributors, however, have another kind of customer – the manufacturers they represent – to whom they must sell themselves – and their value as a distribution partner.
What is the margin of a distributor?
If you are a manufacturer or supplier, and you want to sell your products to consumers, you will have to work with distributors and retailers, both in your home country and abroad. The margin for a distributor may range from 3\% to 30\% of the sales price, the margin for the retailer may range from very little to 60\%.
Can a manufacturer decide how many distributors it will have?
A: Under federal antitrust law, a manufacturer may decide how many distributors it will have and who they will be. From a competition viewpoint, a manufacturer may decide that it will use only franchised dealers with exclusive territories to compete more successfully with other manufacturers.
Can a manufacturer set the retail price of a product?
Manufacturer-imposed Requirements. A dealer is free to set the retail price of the products it sells. A dealer can set the price at the MSRP or at a different price, as long as the dealer comes to that decision on its own. However, the manufacturer can decide not to use distributors that do not adhere to its MSRP.
What should I look for in a distributor agreement?
You may want a clause that prevents the distributor from selling any products that compete with your own both during the agreement and perhaps for a period after it has come to an end as well. In addition, you will probably want to be sure that the terms of the agreement are kept confidential.