Distributor

A distributor is a party in a supply chain that purchases products from manufacturers and sells to retailers or end users, typically taking ownership and bearing inventory risk. They bridge production and market by providing coverage, storage, and logistics, plus sometimes marketing and after-sales support.

In operation, distributors negotiate terms with manufacturers, hold inventory, handle warehousing, order processing, and distribution logistics. They may offer credit, demand forecasting, and co-op marketing. They often operate under a distribution agreement that defines territory, pricing, and service levels. Some are exclusive to a territory, while others are non-exclusive; master distributors manage broad regions; regional distributors handle defined areas.

Distinctions: A distributor usually takes title to goods and bears risk, whereas an agent or broker facilitates sales without taking title. A wholesaler may or may not take title; a retailer sells to end consumers. A distributor differs from an importer/exporter by scope of role but may also handle international sales.

In regulated sectors such as pharmaceuticals, distributors require licensing and compliance with track-and-trace, controlled substances; in general, regulatory compliance and contract law govern distribution agreements.

Metrics and efficiency: common KPIs include service level (fill rate), days of inventory, stock turnover, and gross margin. Global distributors enable market access, reduce lead times, and support manufacturers with channel marketing and local knowledge.