Categories of Distributors/Agents

An Expert's View about Business Administration in China

Last updated: 22 Feb 2011

5-1 Categories of Distributors/Agents

Distributors generally fall into four categories:

Category One Distributors

This category of distributors abide by agreements; possess high credibility, strong marketing capability, extensive sales network and good capital flow; have the same business philosophy as the enterprises they serve; and have long-term development plans and strategies. With such strengths, they are high quality partners and can be nurtured to become long-term distributors for enterprises.

As a gesture of support to these distributors, enterprises can grant them a credit limit in payment for goods, allowing part of the payment to be settled in cash and providing credit for the remainder.

Category Two Distributors

The sales capability of these distributors is relatively weak, yet they have good credibility. Support from manufacturers is often required.

In dealing with this category of distributors, manufacturers have to provide support and guidance such as sending sales representatives to assist them in developing the market, boosting their sales capability and confidence. Preferential treatment such as extending their credit period or lowering their minimum order requirement may also be considered.

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Posted: 21 February 2011, last updated 22 February 2011

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