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May 7, 2018
All You Need to Know About Manufacturer’s Representative Agent
It may be hard to believe but manufacturers representative agency and distributors are offering almost the same service. Both of them sell goods made by manufacturers and neither is directly employed. Rather, they are independently operating. A big difference however between these two is that, distributors sell and also, buy goods while representatives are acting as sales agent for the manufacturers.
A typical distributor is buying goods directly from the manufacturer at a wholesale price and then, reselling it either to consumers or retail outlets. In reality, distributors take ownership of the items they are selling and at the same time, maintain inventory of it. Distributors are in charge to get products into retail stores and whenever that store need additional inventory, they are ordering it from distributors instead of the manufacturer. This is when the distributors generate profit from markup or in other words, the difference between what they have paid to the manufacturer for the goods and what they are charging to clients.
The sales, distribution and production require various levels of expertise to which Chaparral Technologies can provide. Actually, it’s more efficient for the manufacturers in turning to those functions to the independent distributors as well as manufacturers representative agency and representatives than building and maintaining expensive marketing channels. This enables the manufacturer to just focus on what they do best, which is to make things.
In most cases, manufacturers representative agency and representatives are used. These representatives or sales agents are hired normally for situations whenever there is lack of sales force for the manufacturer, whenever a new product has to be introduced in the market, when there is a new market that the company would want to enter but it is not yet developed in full for their sales force to be used and when it is more effective than using the company’s personnel. The possibility of making sales is unjustifiable to the cost of utilizing sales force of the company or it could be that the company is thinking of others ways on how they can diminish fixed cost risks of their internal sales force.
Aside from those mentioned benefits, some inc. companies and corporations are taking advantage of such service when a retail buyer needs dedicated sales as well as marketing support from the manufacturer.
In reality, working with manufacturer’s representative agency have great use. They will make sure that everything is set properly from start to finish while establishing brand and awareness for the company they are working for. So if you want to experience success, then working with such would be a very smart move to make.
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