A distributor is a business that purchases goods from a manufacturer and then sells them to retailers, other businesses, or sometimes directly to consumers. They act as an intermediary in the supply chain, facilitating the movement of products from production to the end user.
Here's a more detailed explanation:
Key Functions of a Distributor:
Purchasing in Bulk:
Distributors buy products in large quantities from manufacturers, often at a discounted price.
Inventory Management:
They store and manage the inventory of the products they distribute.
Sales and Marketing:
Distributors play a role in selling the products to retailers or other businesses, sometimes even taking on marketing responsibilities for the manufacturer.
Logistics and Transportation:
They handle the transportation and delivery of goods to the points of sale.
Distributors vs. Wholesalers:
While often used interchangeably, there can be a subtle difference between distributors and wholesalers. A distributor often has a closer relationship with the manufacturer, potentially involving more active sales and marketing efforts, whereas a wholesaler primarily focuses on fulfilling retailer needs and may not be as involved in the manufacturer's overall sales strategy.