Distributor vs Sourcing Agent: Learn The Difference

DISTRIBUTOR VS

SOURCING AGENT LEARN THE DIFFERENCE

Introduction Procurement is unpredictable as there are too many variables involved.

As every stage of procurement cannot be monitored properly, companies hire procurement agents in UK to look after the nitty-gritty.

In procurement, outcomes may not meet expectations, which is why this is risky in low-cost markets. If you are planning to source products, you need to deal either with a distributor or an agent. So, what’s the difference?

A distributor purchases products in a wholesale and sells you at marked-up costs. Meanwhile, an agent will contact a variety of manufacturers or suppliers, source the goods, and make a commission from the sale. Outlined below are the criteria where you can understand how to choose between an agent and a distributor.

Product Range Distributors will come to you only a set of ready-made products available for sale, whereas sourcing agents have more overseas connections and can reach many markets. These agents make different products available with different specifications needed by a buyer. They place an order to a supplier when a buyer chooses a product.

Product Customisations When you work with a distributor, you do not have any option to customise the products as the products available to them are part of their inventory. Whereas, if you work with agents, they have a wide network of manufacturers or suppliers who can make customised products as per a buyer’s requirement. The buyer can approve the products or send them back for further alterations.

Varying Costs The procurement agents in UK check the costs to keep the budget restricted. They need to make sure that the price does not exceed their spending on the goods/services. Work with an agent is cost-effective because he/she gets only a fraction as the commission. The contract is between you and the supplier, and you get the products as per the factory rates. In the case of a distributor, he/she can add anything over the actual rate and not reveal the actual price.

Possibility Of Prototyping Dealing with an agent helps you to create a prototype before placing an order. He or she will help you choose the right supplier before carrying out an order with quality checks and the right pricing. There are no prototypes available in distributors as they deal with finished products.

Factoring In Time If a buyer wants something to be delivered urgently and does not want much customisation, you can go for the distributors. This will save a lot of time in the procurement process as products are already present in their inventory.

Working with agents may take a longer time but it comes with great quality control and desirable price.

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Quality Control Working with sourcing agents provides buyers with different kinds of regulations for optimal results. The goods can be built as per the requirements given and can even undergo alterations if needed. Working with distributors is quicker but expensive with limited options present in the inventory.

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