Why have distributors

This allows you to utilize a distributor's large network of retail clients to keep updated on customer preferences. Distributors present a ready-made audience of retail clients in any market for a manufacturer that is looking to expand its product reach. For example, if your company has decided to try and compete in a European market, you can find an international distributor that will find a network of European retail outlets and give you the information you will need on what kind of product features a European audience would prefer.

George N. Root III began writing professionally in By George N. It doesn't matter if your company is big or small. Becoming a distributor is an excellent first step in growing and expanding your business. It takes a lot of hard work and dedication, but we have found that the business relationships developed over the years are imperative to the growth of our company.

It only takes one phone call, email or meeting to get the ball rolling. It's your opportunity to seize. Make the most of it, and enjoy the benefits that come from being a distributor. Learn more about Generation Next. Visit NTEA Insider , a bi-weekly digital publication providing the latest news for the vocational truck and equipment industry.

Let the distributors do all the heavy lifting. Understanding of the market Distributors have an intimate understanding of the market. They know who to reach, where best to take your product and how to get prospective buyers interested. So if you have a niche product, it is not going to work everywhere, you need to know where to sell it for maximum impact and this information is available with convenience store distribution They might even suggest new markets that you had no idea even existed and take your product there.

Sales and marketing Distributors are champion sellers. Motivated One of the biggest reasons why they are able to sell so quickly is because they will sell the products as though they were their own. That is because the only way for convenience store suppliers to make a profit is to resell their stocks. The profit motive is always a driving factor. When the first batch goes out, that itself is an indicator that the product is selling well and they will want to ride on the profits over again.

Logistics Distributors have the trucks, vans and manpower that is necessary to transport the goods to where ever it is they need to go. Few manufacturers have this ability. Firstly, distributors fulfil a role that may be quite obvious: they buy and hold stocks for the manufacturer. In most cases, distributors actually buy the goods from the manufacturer, which frees up working capital for the manufacturer. End-users almost always buy from several manufacturers. In addition, distributors can share credit risk.

Although the manufacturer will offer credit to the distributor, this is less risky than offering credit to the hundreds of customers the distributor deals with, especially since the manufacturer will only have limited access to information about the creditworthiness of end-users. Next to credit risk, distributors also share selling risk. The distributors have a stake in selling the products, since they have made a commitment by buying the products from the manufacturer.

This means that they will be motivated to sell the products. In the event that sales are disappointing, the loss will be shared between the manufacturer and the distributor.

From a marketing perspective, one of the most important functions of distributors is that they can forecast market needs. Distributors are clearly closer to the market and are better placed than manufacturers to forecast what their customers will need. By providing this information to the manufacturer, the latter is better able to provide superior value to consumers.

Finally, distributors provide market information. They are well-placed to share information about the market, about competitive activity and so forth.