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Definition

distributor

A distributor is an intermediary entity between a the producer of a product and another entity in the distribution channel or supply chain, such as a retailer, a value-added reseller (VAR) or a system integrator (SI). The distributor performs some of the same functions that a wholesaler does but generally takes a more active role.

At a minimum, distributors handle payment and procurement but, unlike wholesalers, their roles can be much more complex. For example, vendors that lack the means to build out a channel program by themselves often outsource that work to distributors. Distributors also frequently take a more proactive approach in educating resellers about new products, through such activities as presales training, road shows, and demos on behalf of vendors. Distributors may provide services around the procurement process, such as contract negotiation, marketing for resellers and SIs, and warrantees. Increasingly, distributors also host network operations centers (NOCs).

Although the specific entities and order involved can vary, the supply chain or distribution channel involving a distributor is generally: vendor to distributor, distributor to reseller or SI, reseller or SI to end customer.

See also: IT distributor, channel strategy, channel partner, distributor agreement

This was last updated in March 2013

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