Capterra Glossary
Distributors
Distributors are entities that buy a large number of products from a manufacturer with the intent of distributing them to customers. Distributors can either sell the products directly to customers or partner with retailers, who sell the products to their customers.
Typically, distributors earn revenue by buying huge quantities of discounted products from the manufacturers and selling them directly to customers or retailers at an inflated price. Distributors are an important part of the supply chain because they help manufacturers sell their products to a wider customer base.
What Small and Midsize Businesses Need to Know About Distributors
Small and midsize manufacturing businesses often strike business deals with distributors to convince more customers to buy their products. Most distributors have strong relationships with the retailers they partner with, allowing them to sell products more effectively than manufacturers could on their own.
Related Terms
- Enterprise Resource Planning (ERP)
- Procurement
- Total Cost of Ownership (TCO)
- Vendor
- Supply Chain Planning (SCP)
- Telematics
- Senpai
- Vendor Management
- Value-Added Reseller (VAR)
- Bill of Materials (BOM)
- Supply Chain
- Smart Factory
- Scanner
- SCADA (Supervisory Control and Data Acquisition)
- Radio-frequency Identification (RFID)