Dealer vs. Distributor — What's the Difference?
By Tayyaba Rehman — Updated on September 23, 2023
A dealer typically sells goods directly to consumers, while a distributor supplies products to dealers or other businesses.
Difference Between Dealer and Distributor
Table of Contents
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Key Differences
A dealer is an entity that buys products to sell them directly to end consumers, operating on a retail level. They have a direct relationship with the consumers and often provide services related to the product, such as after-sales services. On the other hand, a distributor functions at a wholesale level, supplying products to dealers or other businesses, but not typically to the end consumer. They play an intermediary role in the supply chain, sourcing products from manufacturers and providing them to various dealers.
Furthermore, dealers focus on achieving sales targets and establishing a brand presence in a particular territory or region. They interact closely with the end-users and have a deep understanding of market demands and preferences. Conversely, distributors manage a broader territory and have relationships with multiple dealers. Their primary function is to ensure that products are available to dealers in sufficient quantity and at the right time.
The financial dynamics differ as well. Dealers make profits by marking up the product price they received from distributors or manufacturers. Distributors, meanwhile, earn by marking up the prices of products when selling them to dealers, based on the volume or the agreement they have with the manufacturers.
Lastly, while both dealers and distributors are essential cogs in the product distribution machine, their roles, responsibilities, and interactions with other stakeholders in the supply chain are distinct. A seamless partnership between them ensures that products reach the end consumer efficiently.
Comparison Chart
Function
Sells products to end consumers.
Supplies products to dealers or other businesses.
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Relationship
Direct with consumers.
Intermediary between manufacturers and dealers.
Level
Retail.
Wholesale.
Profit Method
Markup on product price from distributors or manufacturers.
Markup on product prices when selling to dealers.
Territory
Specific region or area.
Broader region, possibly multiple areas or even countries.
Compare with Definitions
Dealer
An individual who acts as a principal rather than an agent.
The stock dealer operated independently on the market floor.
Distributor
A business that ensures product availability across regions.
The book distributor worked closely with several publishing houses.
Dealer
An entity that sells products directly to consumers.
The car dealer offered a discount on the latest model.
Distributor
A firm facilitating the movement of goods from producers to the market.
The movie distributor managed the film's release in various theaters.
Dealer
A retail outlet or agent selling specific products.
The electronics dealer ensured the product had a warranty.
Distributor
An intermediary that supplies products to retailers or dealers.
The national distributor had a network covering all major cities.
Dealer
A person who buys and sells goods
A dealer in foreign stamps
Distributor
An entity responsible for wholesale product distribution.
The distributor ordered a large batch of goods from the manufacturer.
Dealer
The player who distributes the cards at the start of a game.
Distributor
An agent that handles product storage and delivery.
The distributor maintained a vast warehouse for inventory.
Dealer
One that is engaged in buying and selling
A used-car dealer.
A drug dealer.
Distributor
A distributor, also commonly known as a dizzy, is an enclosed rotating shaft used in spark-ignition internal combustion engines that have mechanically timed ignition. The distributor's main function is to route secondary, or high voltage, current from the ignition coil to the spark plugs in the correct firing order, and for the correct amount of time.
Dealer
The person who distributes the cards in a game of cards.
Distributor
An agent who supplies goods to retailers
A sports goods distributor
Dealer
In a game of cards, especially poker, the position from which cards are dealt clockwise around the table, usually marked by the button.
Distributor
A device in a petrol engine for passing electric current to each spark plug in turn.
Dealer
A croupier.
Distributor
One that distributes, especially a device that applies electric current in proper sequence to the spark plugs of an engine.
Dealer
One who deals in goods, especially automobiles; a middleman.
That used car dealer gave me a great deal on my 1962 rusted-out Volkswagen bug!
Distributor
One that markets or sells merchandise, especially a wholesaler.
Dealer
A drug dealer, one who peddles illicit drugs.
Distributor
One who or that which distributes.
Dealer
A particular type of stock broker or trader.
Distributor
A device that distributes electric current, especially to the spark plugs in an internal combustion engine.
Dealer
The person who deals the cards in a card game.
Distributor
A machine for distributing type.
Dealer
One who deals or metes out anything.
Distributor
An appliance, such as a roller, in a printing press, for distributing ink.
Dealer
One who deals; one who has to do, or has concern, with others; esp., a trader, a trafficker, a shopkeeper, a broker, or a merchant; as, a dealer in dry goods; a dealer in stocks; a retail dealer.
Distributor
One that distributes; a distributer;
Dealer
One who distributes cards to the players.
Distributor
Someone who markets merchandise
Dealer
Someone who purchases and maintains an inventory of goods to be sold
Distributor
A person with authority to allot or deal out or apportion
Dealer
A firm engaged in trading
Distributor
A company that markets merchandise;
His company is a large distributor of software products
Dealer
A seller of illicit goods;
A dealer in stolen goods
Distributor
Electrical device that distributes voltage to the spark plugs of a gasoline engine in the order of the firing sequence
Dealer
The major party to a financial transaction at a stock exchange; buys and sells for his own account
Dealer
The person who distributes the playing cards in a card game
Dealer
A person or firm in the business of buying and selling.
The antique dealer had rare items from the 18th century.
Dealer
Someone engaged in trading activities in a specific market.
The commodities dealer specialized in precious metals.
Common Curiosities
Is a dealership the same as a dealer?
A dealership is a place or business where a dealer operates, especially for vehicles.
Do distributors sell to the public?
Typically, distributors supply products to businesses, not directly to the public.
Can a dealer operate without a distributor?
Yes, if they source products directly from manufacturers or other sources.
How do distributors determine pricing?
Distributors mark up prices based on agreements with manufacturers and volume considerations.
Can a business be both a dealer and a distributor?
Yes, some businesses operate in both capacities, depending on the product or market.
How do distributors source their products?
Distributors typically source products directly from manufacturers.
Do distributors handle product promotions?
While primary marketing is usually the manufacturer's responsibility, distributors can support promotional efforts locally.
What risks do distributors face?
Distributors may face risks like inventory obsolescence, credit risks with dealers, and demand fluctuations.
What is the primary role of a dealer?
A dealer sells products directly to end consumers.
What’s the difference in the scale of operation between a dealer and a distributor?
Dealers often operate on a retail level in specific regions, while distributors operate on a wholesale level across broader areas.
Why are distributors crucial in the supply chain?
Distributors ensure product availability, handle large volumes, and facilitate product flow from manufacturers to dealers.
Can a distributor restrict a dealer’s product range?
Depending on their agreement, a distributor may have stipulations on the range or type of products a dealer can sell.
Do dealers offer after-sales services?
Many dealers provide after-sales services, especially for products like vehicles or electronics.
How do dealers interact with distributors?
Dealers place orders, provide market feedback, and maintain business relationships with distributors.
Why might manufacturers prefer working with distributors?
Distributors can manage logistics, handle storage, and provide access to a broad network of dealers.
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Written by
Tayyaba RehmanTayyaba Rehman is a distinguished writer, currently serving as a primary contributor to askdifference.com. As a researcher in semantics and etymology, Tayyaba's passion for the complexity of languages and their distinctions has found a perfect home on the platform. Tayyaba delves into the intricacies of language, distinguishing between commonly confused words and phrases, thereby providing clarity for readers worldwide.
