It may be hard to believe but manufacturers representative agency and distributors are offering almost the same service. Both of the said entities are selling products made by manufacturers and neither of them is employed directly by the manufacturers. What they are actually is an independent entity. 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.
What distributors typically do is purchase the goods right from the manufacturer but at wholesale price and then, pass it on to retail outlets or to consumers. In reality, distributors take ownership of the items they are selling and at the same time, maintain inventory of it. It is the distributors who are in charge of getting the products to the retail stores and if that store requests for additional supply, they order it from the distributors instead of the manufacturer. It’s when how distributors make profit from their markup or simply put, the difference between what they pay to the manufacturer’s goods and to what is charged to their clients.
From distribution, production and sales as well, it all needs different level of expertise wherein Chaparral Technologies are expert of. 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. Basically, this makes it feasible for the manufacturers to concentrate on what they are doing best, which is to produce and manufacture things.
The truth is, manufacturers representative agency and representatives is frequently used. Basically, these sales agents or representatives are hired for circumstances when there is lack of sales force for manufacturers, when there’s new market the company wish to penetrate, whenever there’s a new product that needs to be introduced in the market and lastly, when it is more cost efficient for the company to get outsource than using their own personnel. The potential of sales might not be justified the cost of using the sales force of the company or the company might like to reduce 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.
The truth is, there are lots of great use for working with manufacturer’s representative agency. 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. If you like to succeed, then it’ll be smart to work with such.