A distributor buys product from a brand outright and resells it to retailers in its market, taking ownership of the stock and the risk that comes with it.
Oct 5, 2026
The defining feature is that the distributor purchases. Once the goods are bought the brand has its money, and the distributor carries the inventory, the warehousing, the credit extended to retailers, and the loss if the range does not sell.
That transfer buys reach a brand could not fund itself. A distributor already holds the accounts, the logistics, and the local knowledge of a market, which is why distribution is the usual route into a territory a brand cannot service directly.
Distributors earn on the spread between what they pay and what they charge, so the brand sells at a lower wholesale price than it would selling direct. The trade is a shorter margin in exchange for volume and somebody else’s receivables risk.
It also costs control. The distributor decides which doors to open, what to stock, and when to discount, and the brand often sees sell-out data late or not at all. Brands who care about placement tend to prefer an agency in their key markets.
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