A distributor is one who buys products from a manufacturer, warehouses them, then sells them to retailers or to end-use customers. A distributorship agreement is a contract made between an individual or entity (the “distributor”) and the manufacturer, setting out the terms under which the distributor may sell the products. Products are purchased from the manufacturer at a low cost, then sold to retailers or consumers at a higher cost to cover the distributor’s costs and earn a profit.
Definition of Distributorship
A wholesaler with exclusive rights to market and sell the products of a manufacturer or supplier, usually within a specified territory.
What is a Distributor
The distributor is considered an independent selling agent. This means that the distributor has permission to sell the product as specified in the contract, but is not entitled to use the trade name as part of its business. The distributorship agreement may also specify that the distributor is bound to sell the supplier’s products exclusively, meaning it cannot sell similar products from another supplier. Large-scale distributors are often referred to as “wholesalers.”
A distributor that is granted exclusive distribution rights is guaranteed to be the only dealer or retailer of a specific product in a specified area, or to be the only dealer or retailer to supply the product to a specified group of people. Contracts for exclusive distribution are most commonly seen in high-end products that require the sales staff to have some degree of training. An exclusive distributorship agreement gives the manufacturer or supplier greater control over how its product is sold. Additionally, exclusive distribution provides some protection to the distributor against other individuals or entities who might attempt to sell the same product at a more competitive price.
Responsibilities of Each Party in a Distributorship
Most commonly, the manufacturer does not dictate how the product purchased should be distributed. However, occasions arise where the manufacturer will offer an agent training in order to use the product. The exact conditions and responsibilities of each party are outlined in the distributorship agreement.
Distributorship and Liability
Even though the distributor is not responsible for manufacturing a product, it can be held liable in the event of defects. Under strict product liability laws, the seller, distributor, and manufacturer of a defective product can be held liable if a person is injured due to the defect. Though manufacturers are typically most responsible since they created the product, the liability can also fall to those that distribute or sell the defective items.
This liability law prevents the plaintiff from the need to prove the chain of supply. In order for any entity in the line of distribution to prove it has no fault, it would need to show which entity is actually responsible for the defect.
In order to prove product liability, the plaintiff must prove:
- The product was sold with the defect
- The seller intended to provide the buyer with the product without making changes
- The plaintiff suffered injuries due to the defective product
Trusting an outside company to manage your simple or complex blending needs can be a difficult move to make. Trade recipes need to be protected and the finished product needs to arrive in-spec, on-time, and contamination free.
We Vapro Lubricants understand the potential risks involved with toll blending and we offer a wide range of services to help simplify the process.
Take advantage of Vapro Lubricants well-equipped on-site laboratory, experienced technicians, and broad toll blending experience.
Vapro Lubricants facility is capable of handling a full spectrum of toll blending needs from engine oil , motorbike oil, industrial gear oil , automatic transmission fluids, brake and clutch fluids, radiator coolant and simple industrial cleaners.
Benefits of Toll Blending
Toll blending allows you to immerse your inventory and packaging systems with our facility and processes in order to develop a seamless working supply-and-demand based relationship. If your blending capabilities are reaching a maximum capacity, we can help handle the overflow. That means you’ll still meet your deadlines without having to expand your facility or turn down additional projects.
Simply supply the raw materials and packaging and we’ll do the rest. We’re readily available to handle your largest bench, pilot or commercial projects.
Tap into the vast knowledge of our experienced team, in-house lab, and extensive supply network as we assist in developing the perfect formulation for your product.
We’ll help keep your costs down and your specification requirements accurate all while keeping your plans completely disclosed. In many cases we can speed up your product development stages by using one of our pre-existing formulas as a starting point for your specific toll blending needs.
Custom and toll blending is offered from simple blends to more complicated reaction blends. We have two water based blending tanks and 6 oil based blending vessels. Blend size can range anywhere from 1,000 liters to 10,000 liters.
Our state-of-the art laboratory, backed by industry leading chemists and support technicians incorporates the latest in technology for fast, efficient service to our customers.
Vapro Lubricants is a leading provider of private label lubricants for a variety of industries. The Vapro Lubricants team can custom blend to any specification and obtain any necessary qualifications as requested. Products can be packaged in quarts, gallons, pails, drums, and bulk.
Custom Training Programs
The Vapro Lubricants team can provide on-site and in-depth training with your team on the features and benefits of the products produced under your private label.
Sales Training & Marketing Tools
Vapro Lubricants in-house marketing and graphic design team can work with you to create eye-catching artwork and labeling that accurately reflects your brand. Additionally, Vapro Lubricants assists customers with flyers, brochures, product data sheets, and safety data sheets.
Free Consultative Services
Choosing the right product mix for your company is crucial to the success of your private label launch. The Vapro Lubricants team has years of knowledge and experience that you can leverage to make the best purchasing decisions for your business.