Contact PTS today if you are looking for seamless distribution of your product(s) nationwide or even cross border.
Appointing an appropriate after sales agent is crucial in ensuring that the product develops a respected reputation in the South African market
Definition: The manner in which goods move from the manufacturer to the outlet where the consumer purchases them; in some marketplaces, it’s a very complex channel, including distributors, wholesaler, agents and brokers.
The Distributor’s Role
As you probably know, manufacturers produce products and retailers sell them to end users. In between, however, there are a few key operators-also known as distributors-that serve to move the product from manufacturer to market. Some are retail distributors, the kind that sell directly to consumers (end users). Others are known as merchant wholesale distributors; they buy products from the manufacturer or other source, then move them from their warehouses to companies that either want to resell the products to end users or use them in their own operations.
Wholesale trade includes establishments that sell products to retailers, merchants, contractors and/or industrial, institutional and commercial users.
Three types of operations can perform the functions of wholesale trade: wholesale distributors; manufacturers’ sales branches and offices; and agents, brokers and commission agents. As a wholesale distributor, PTS run’s an independently owned and operated firm that buys and sells products of which you have taken ownership. Generally, such operations are run from one or more warehouses where inventory goods are received and later shipped to customers.
Business-to-business realm by selling to retail companies and other wholesale firms like your own, and not to the buying public.
Agents: In the strict legal sense, “agent” means a person who, for and on behalf of a principal, either introduces a third party to the principal by soliciting orders from the third party, or concludes contracts with the third party on behalf of the principal. The normal reward for an agent is a commission, which is received from the principal.
Key considerations in appointing an agent in South Africa are:
• You need to appoint an agent who knows your market well. The South African business sector is relatively small, and companies have established methods of procurement that differ from sector to sector.
• You need to consider national distribution. South Africa is a large country, with nine provinces. Lacking the support of national infrastructure, smaller agents often tend to operate provincially. This means you may need to appoint an agent in each of the larger cities – Johannesburg, Cape Town, Port Elizabeth and Durban – to cover the country. Larger companies who take on agencies often have an office in each of the major centres, making any agency agreement easier to control.
• For certain products, South Africa is a trading hub for the southern African region, and you need to consider whether your South African agent should handle business in these countries on your behalf.
Distributors: A distributor buys and holds stock of a product. In return, they are usually granted an exclusive right to sell the product in a particular area or to a particular type of customer. An agreement with a distributor is similar to an agreement with an agent, except that price and delivery terms will differ because the distributor is a principal.
When appointing a distributor in South Africa, the same considerations apply as when appointing an agent.
Alternatively if you are looking to partner as an accredited distribution affiliate then contact us too.
To combat the consolidation trend, many independent distributors are turning to the specialty market. “Many entrepreneurs are finding success by picking up the golden crumbs that are left on the table by the national companies,” Fein says. “Our distribution has evolved from a local to a regional to a national business, big corporate companies [can’t or don’t want to] cost-effectively service certain types of customers. Often, small customers get left behind or are just not [profitable] for the large distributors to serve.” That’s where PTS steps up.
Maintaining attractive deals for retailers.
Keen price & terms negotiation