There are a lot of terms that people use interchangeably, just because they are somewhat similar. Two such terms in the world of computer hardware and software systems are distributors and resellers. For example, people might get confused differentiating between an intel reseller or an intel redistributor.
In this article, you will learn about the differences between a distributor and a reseller:
Who is a Distributor?
A distributor is an entity that helps a producing company move its goods and products and get them on the market. A good distribution system includes a wide range of services such as a distributor buying a product and reselling them to the retailers by providing promotional support, manpower, after-sales services, branding, etc. In most cases, distributors stock up on the manufacturer’s products. For this, they need storage spaces, great logistics, and people to handle the branding, shipping, storing, and investment in the products. Through this, they can ensure that all the products reach shelves.
Who is a Reseller?
A reseller is an entity that buys services and products to sell them and earn profits. They are the middlemen for the goods and products they are moving. However, they don’t stock up any products. Their purpose is to find retailers. They have limited input but a good profit margin. For example, in the case of an intel reseller, they will bring together the Intel manufacturer with the retailer.
Difference Between a Reseller and a Distributor
A reseller is a middleman, whereas a distributor is a type of partner. It depends on your business, the business relations you have established, and the extra services you need when it comes to selecting one over the other. A reseller is an intermediary, whereas a distributor can handle getting your product to the new client, especially if you are a new company.
The difference in services between the two will be visible in costs as well. The services offered by a distributor are more complex because they have been designed to step in and ensure that a product that doesn’t have enough backing from its manufacturer still has the same chances. This also implies less profit and higher margins for the manufacturer. However, a reseller makes no such commitment and plans on moving the already established products in the market. They don’t provide additional services or stock up. The margins are lower, but the name of the product is what carries the load all by itself.
This shows why a distributor might be more expensive than a reseller. When it comes to products like Intel, which already have a well-established name in the market and sell themselves, a reseller doesn’t have to do anything. But, in the case of a new company, they might need the support system offered by the distributor.
When you are looking for a vendor, you mustn’t get too caught up in the terminology. For instance, a solution advertising as a reseller might be a part of a channel partnership, or a partner program might be a dealer network working in disguise. Some intel seller companies use the word only for recognizability, even though their seller model is based on partnerships. This shows that the words don’t matter as much as the actions. You have to pay attention to the services they are using.