Software distributors are businesses which act as intermediaries between suppliers and customers by providing a platform for marketing products. They provide end users with access to various technologies from different companies. In order to serve their clients, these organizations have developed distribution networks around the world through partnerships with local partners who can distribute the product in a particular country.
The role of a distributor is similar to a wholesaler’s role in traditional retail sales. However, there are some key differences here too. For example, unlike other retailers, distributors don't carry inventory but instead pass on all orders placed by their clients directly to the supplier. This allows them to focus more on their core competencies such as customer service and relationship building rather than stocking items at store level. Also, they often offer technical support services to help solve any problems that may arise during installation and use.
In this article we will explain what exactly a distributor does and how they differ from other types of retailers. We will also take you through a list of questions related to distributors so that you know everything about your potential vendor before signing up for a contract!
A software distributor provides its customers with the ability to purchase software licenses from multiple sources. These distributors act as middlemen between the company selling the product and end users who buy the license. Distributors usually sell only one type of product per category and generally work with several large corporations. The reason why many distributors choose to specialize in just one area is because it ensures consistency across each client's needs.
For example, if a certain software developer releases two versions of an application, a distributor might be able to handle both of them while another would need time to create separate contracts for each version. Another benefit of specialization is that it helps distributors establish long term relationships with major brands since they're likely to come back to them again in future years.
Another important aspect of becoming a distributor is setting up a strong network of contacts within the industry. Most distributors start out small, but over time grow into larger operations thanks to word of mouth referrals from satisfied clients. It's common practice for distributors to hire third party agencies like professional recruiters and consultants to find new opportunities and expand further.
As mentioned earlier, most distributors operate regionally due to limited resources and geographical constraints. Some even go global by developing international branches in foreign countries. One of the advantages of working internationally is having access to markets outside of North America. On the downside however, it means dealing with cultural barriers and language issues which could slow down communication processes.
While there isn't much room for growth in terms of geographic expansion, distributors can still increase their revenues by acquiring smaller players in adjacent regions. A prime example of this strategy was when Ingram Micro acquired Synnex Software Solutions in 2014, thus adding nearly 50,000 software professionals to its ranks. By doing so, it improved its market share in Europe and Latin America.
Since distributors aren't involved in buying or storing inventories themselves, they save money on costs associated with storage and transportation. Instead, they rely heavily on suppliers to deliver goods from warehouses to consumers. That said, distributors usually pay higher prices compared to manufacturers when purchasing wholesale quantities of products. But they also get better pricing options such as volume discounts and free shipping perks.
They also earn commission fees whenever they successfully place deals with their clients. As a result, they're incentivized to make sure every transaction goes smoothly. That way, they'll continue offering good products and services to their clients without worrying about losing profits.
Distributors also perform quality assurance checks before distributing a given product. Once they receive payment, they send the item to a warehouse where it gets packaged properly before being sent to buyers. If anything happens along the way, they contact the manufacturer immediately to resolve the issue.
Finally, distributors ensure security and confidentiality during transactions. Since they deal with sensitive information, they keep data stored securely and protect it against unauthorized access.
Technicians and engineers in industrial sectors tend to prefer using distributors over direct purchases from manufacturers since they're easier to reach and quicker to respond to inquiries. Distributors provide their clients with easy ways to communicate with developers via email, phone calls, and online chat rooms. This makes it convenient to coordinate schedules and arrange for deliveries.
Also, distributors typically offer more flexible licensing models than OEMs. While OEM tends to stick to either perpetual or subscription based licenses, distributors allow customers to select monthly payments depending on their budgets. Many also give additional benefits including guaranteed delivery dates and discount rates.
Furthermore, distributors perform warranty repairs after receiving complaints from clients. They also offer extended warranties and replacement guarantees should something happen to their products. Lastly, distributors have dedicated teams handling account management and billing duties. So no matter what kind of support you require, chances are that someone will answer right away.
To put it simply, a distributor is responsible for bringing together people, ideas, processes, systems, and technologies to meet a specific goal. Their primary objective is to maximize revenue streams and improve profit margins. To achieve those goals, distributors spend a lot of time networking and maintaining relationships with corporate executives.
At the same time, they develop strategies designed to attract new customers and retain existing ones. When it comes to recruiting employees, distributors employ tactics ranging from social media campaigns to job fairs. They invest in training programs and seminars to educate staff members on best practices and emerging trends.
One of the things a distributor must consider is whether to become a part of a consortium. According to research conducted by TechTarget, 48% of respondents reported that joining a group has helped them build stronger ties with suppliers and reduce operating expenses.
Who are distributors
Distributors help to create demand for new technology and products. As a result, they increase awareness about them among potential buyers. Distributor provides market intelligence on trends and helps to identify emerging markets.
In addition, distributors also play a role in creating brand loyalty and driving sales. Due to this reason, many manufacturers prefer to partner with distributors rather than directly selling their products to retailers and end consumers.
How to become a distributor
To start your own organization as a distributor, you need to acquire a license to sell certain kinds of products. You may be able to get one if you already run a company that sells similar types of products or services. If not, you will most likely need to go through the process of becoming certified as a vendor-approved entity (VEA). These agreements allow authorized sellers to represent a specific manufacturer’s products in a single territory. VEAs typically require applicants to submit detailed information about themselves, including financial statements, proof of insurance coverage, and other requirements set forth by each manufacturer.
Once approved, VEA holders gain access to information about upcoming products, promotional offers, and special deals. Additionally, they receive discounts, free shipping, and other benefits when purchasing items from those manufacturers. It is important to note that some VEAs only apply to certain countries, regions, or industries, so it is imperative to check whether yours falls into any of the categories before applying.
A software distributor is a company that sells preloaded computers to end users such as corporations and government agencies. The distributor then distributes these systems to other companies for use by their employees. These businesses usually specialize in selling PCs, laptops, tablets, smartphones, printers, scanners, etc. In addition to this, they also sell software related products like antivirus programs, anti-spyware applications, productivity suites, office suites, etc. They act as middlemen between the manufacturer's sales team and VARs or SIs who take care of installation, configuration, training, support, maintenance, upgrades, warranty, etc. This model has become very popular in recent years with the rise of cloud computing.
The following questions will help you understand why people choose to work at a software distributor rather than directly with a vendor.
There are two main types of distributors - one type specializes in PC hardware and another focuses on software. Here are some examples of each type:
1. Computer Distributors: This is probably the most common type of distributor. It provides access to all sorts of components from different manufacturers. For example, a distributor may provide both Windows 10 Pro and Windows 7 Professional operating systems along with various brands of RAM, hard drives, graphics cards, monitors, keyboards, mice, headsets, speakers, cables, etc. The distributor also offers services like repair, upgrade, and maintenance contracts for its customers' equipment.
2. Software Distribution Companies: A software distribution company can be thought of as the ultimate "one stop shop" for any kind of software product. It not only gets licenses but also manages them. Its role includes taking care of marketing, pricing, customer service, technical support, ordering, inventory management, billing, etc. Some well known companies include Ingram Micro, Tech Data, Synnex, TD Synnex, etc.
3. Value Added Resellers (or Independent Installer): This type of distributor works exclusively with specific vendors. Instead of getting direct access to the actual product, the distributor buys the license and installs it on behalf of the client. Then, he/she takes responsibility for everything else including setup, testing, troubleshooting, monitoring, updating, upgrading, maintaining, and supporting the software.
4. System Integrator (SI): An SI performs similar functions to a traditional ISV except that she/he doesn't develop the software herself/himself. She/He purchases the rights to install the software and manage it after purchase. Many times, the cost of development is included in this package so there isn't much extra expense involved.
5. Original Equipment Manufacturers (OEM): OEMs don't have any relationship whatsoever with software developers. Their job is to design consumer electronics devices like TVs, phones, cars, laptops, smartwatches, wearables, etc., which are sold under brand names like Apple, Samsung, HP, Sony, Google, Microsoft, LG, etc. So, when you buy a TV from Best Buy, you're actually buying it from your local retailer who purchased it from an authorized dealer of the original manufacturer. There is no third party involved here because the retail store itself was created by the manufacturer.
6. Channel Partners: This term refers to those who partner with OEMs. Unlike the above mentioned entities, partners don't carry out manufacturing activities themselves. Rather, they sell branded products to retailers and wholesalers. When someone wants to buy a TV online, s/he would find a listing for a particular brand followed by contact information for the channel partner. After contacting the channel partner, the buyer makes his choice and pays for the item through the channel partner's website.
7. Technology Distributors: Technological distributors focus mainly on tech solutions like IoT platforms. They offer turnkey packages where they bundle many technologies together into one solution. Examples include AWS platform solutions, Salesforce Platform Solutions, Azure platform solutions, SAP HANA, Oracle Database Cloud Service, IBM Watson, Cisco Networking Services, etc.
8. Hardware / Software Distributors: Both the terms refer to the same thing. However, they sound differently due to the fact that hardware distributors deal in physical items while software distributors deal in digital assets.
9. Mobile Device Distributors: Like most other mobile device distributors, these companies distribute handsets like iPhones, Android phones, iPads, etc. Their primary task is to facilitate the sale of these gadgets either online or offline.
10. Networking & Communication Distributors: Most networking and communication distributors handle routers, switches, hubs, Wi-Fi adapters, network security appliances, wireless access points, cable modems, DSL Modem, VoIP gateways, IP cameras, DVRs, etc.
Distributors are more focused on providing goods whereas suppliers are concerned about production. Suppliers are often referred to as manufacturers.
Suppliers typically make things and manufacturers assemble things. That said, even though manufacturers are responsible for making the final product, they still need to source supplies from outside sources. Distributors get raw materials from producers and then transform these into finished products.
In short, distributors are more about logistics whereas suppliers are more about production. You'll notice that many of the aforementioned companies are distributed across multiple countries. Even though the majority of their operations happen within the US, they've outsourced their supply chain to places like China and India.
Software distribution means delivering copies of software to end users without having to go through individual licensing agreements. This practice allows smaller organizations to avoid paying large sums of money upfront. As opposed to purchasing the entire copy of a piece of software, an organization ends up receiving just enough to meet their needs.
When you order something online, you normally pay a flat fee called a shipping charge. If the total amount of the shipment exceeds $25, the seller must first cover the cost of packaging before handing over the rest to the carrier. Similarly, if you subscribe to an e-mail newsletter, you won't receive every single email until the next installment arrives unless you opt in for auto-shipment. On the other hand, when you download a free app, you might never see the second part of the installer until you complete the process. This is how software distributors operate.
Since software is delivered digitally instead of physically, it's important to know whether the recipient owns the right to redistribute the file(s). In case of desktop publishing, this shouldn't pose too big a problem since the user already paid for the software outright. But for enterprise apps, you'd better double check with whoever licensed the software. Otherwise, the risk of violating copyright laws exists.
For instance, Adobe Photoshop costs around $600 per year. Since you can easily create high quality images using free alternatives, many photographers prefer to stick with these open source tools. Although they have their own pros and cons, they are nonetheless good options compared to expensive proprietary software. By choosing to stick with open source software, the photographer avoids shelling out thousands of dollars upfront.
As explained above, a distributor helps small businesses acquire the required resources quickly and efficiently. In the context of computers, this means installing OSes, applications, drivers, and peripherals.
However, a lot of individuals consider a computer to be nothing more than a fancy calculator. And, although they're technically correct, they fail to recognize the importance of a properly configured machine. Without proper knowledge, anyone could potentially damage their data files and permanently lose valuable information.
That said, a competent technician should always perform regular maintenance tasks such as cleaning the screen, fixing broken parts, backing up data, repairing errors, performing virus scans, etc. The best way to ensure that your computer remains safe and secure is to hire a professional, certified technician.
Distributors are organizations that act as intermediaries between suppliers and end users. They buy products from manufacturers and then sell them to customers. Distributors can be either independent entities or part of larger corporations.
When you purchase anything these days, whether it's a car, a book, or even something for your home office, you're likely using a third party -- someone who isn't directly affiliated with the seller but has been granted permission by the manufacturer to market their product. This person is called a distributor because they "distribute" the product on behalf of its maker.
In this article we'll discuss what exactly a distribution company does, why businesses choose to work with distributors, and how distributors actually make money.
The primary purpose of any type of distributor is to help people find what they need. If you were looking for a new laptop computer, chances are that you'd contact Dell first. Then if Dell doesn't have what you need, you might try HP next. And if HP doesn't provide you with what you need, perhaps Apple would. Or maybe there's no one at all selling laptops that fit your needs. In other words, when you don't know where to look, you turn to a distributor. A good distributor will point you toward the right place to get what you need.
This basic idea explains most of the functions of a typical distributor. The company buys inventory from a supplier and sells it to consumers. It also handles customer service issues and provides technical support. Some distributors specialize in particular types of products while others focus more broadly across several industries. For example, Ingram Micro distributes electronic components such as semiconductors and displays, while Synnex Technologies focuses primarily on communications equipment.
Companies typically rely on distributors because they offer many benefits. One benefit is cost savings. By buying from multiple sources instead of just one, distributors usually lower prices than direct sales. Another big advantage is speed. Because distributors already deal with large numbers of clients, they often have access to better deals and faster delivery times than individual sellers.
Another great thing about working with distributors is that they have extensive knowledge of various markets. When you buy through a distributor, you're not only getting the best price available but also receiving expert advice from professionals familiar with your industry.
One reason why businesses prefer to work with distributors over direct sales is security. Since distributors aren't necessarily associated with the same brand names as major online retailers, they won't take risks like those presented by Amazon or Best Buy. Instead, they tend to stick with established brands that produce reliable products and services.
Because distributors maintain relationships with trusted brands and reputable manufacturing partners, they can offer better guarantees and warranties than individuals could ever hope to achieve. Additionally, since distributors handle returns and exchanges, buyers receive refunds should problems arise within 90 days of purchase. Finally, distributors are able to monitor inventory levels so that orders arrive fresh and in time for holiday shopping season.
It's important to note that although distributors may seem less risky than other options, they still carry some risk. You never really know what kind of financial trouble a company may encounter until after you've purchased their goods. That said, distributors generally handle most of the headaches involved with ordering and shipping items.
Because distributors carry out many tasks themselves, they save both money and resources. Furthermore, when you order from a single source, you're required to wait longer for shipments to come in before you can start making purchases again. On the flip side, having multiple channels means that you can quickly switch gears and move onto another item without worrying too much about waiting for things to ship.
Finally, distributors often give you the ability to customize your package. Rather than offering preselected bundles, distributors allow you to mix and match different parts to create a custom solution. Depending upon your specific requirements, you might add extra accessories or change the size of certain elements to suit your preferences.
For example, let's say that you wanted to build a gaming PC. You could opt to go with Intel processors, Nvidia graphics cards, and Windows 10 Home Edition. Alternatively, you could select AMD chips, Radeon GPUs, and Windows 8 Pro. Both configurations meet your specifications perfectly well, yet each contains a wide range of choices.
With a distributor, you can easily swap out an Intel processor for a Ryzen chip, or upgrade a graphics card from an EVGA GeForce GTX 1070 Ti to a MSI GEFORCE RTX 2070 Super. As mentioned above, you can also mix and match parts to create unique solutions that wouldn't otherwise be possible.
Manufacturers depend heavily on distributors to ensure that they deliver quality products on time. Without distributors, companies would face huge delays due to poor planning, miscommunication, and missed deadlines. However, the reverse is true also. Businesses must treat distributors fairly because they perform essential roles for everyone involved.
First, distributors keep tabs on the supply chain. With thousands of distributors worldwide, they have a vast network of contacts, allowing them to track down rare or hard-to-find pieces of equipment at a moment's notice. They also monitor demand trends so that manufacturers can anticipate future demands. Lastly, distributors manage logistics to ensure timely deliveries. All of these factors contribute greatly to maintaining efficiency throughout the entire process.
But distributors aren't limited to merely being middlemen. Many also act as consultants, helping manufacturers develop new products and solve common challenges faced by their target audiences.
Lastly, distributors play a crucial role during production. Before the final units leave a factory, they inspect every last component individually. They test each piece of equipment thoroughly to determine whether it meets standards. Afterward, they check each batch against a master list of defects, ensuring that nothing was overlooked.
Most importantly, distributors verify that everything works correctly before sending finished products off to retail stores. Once the product hits store shelves, distributors continue monitoring stock levels and checking for potential errors.
As previously stated, distributors serve several purposes. Aside from saving costs, distributing merchandise allows businesses to reach millions of customers simultaneously. Distributing allows you to spread your message far beyond your local area.
Additionally, distributors can provide valuable information regarding consumer satisfaction. Companies can collect feedback from their customers via surveys, which helps them improve their products and processes. They also learn what features are desired by their audience, enabling them to design products accordingly.
At the same time, distributors enable companies to expand into emerging markets. While many small businesses operate locally, distributors help them grow internationally. Through partnerships, distributors open doors to international markets and increase exposure abroad.
Ultimately, distributors reduce overhead expenses and boost profits. Not to mention, they free up employees to tackle bigger projects and spend more time doing what they love.
If you own a business, you probably feel overwhelmed by the sheer number of decisions that you have to make everyday. Choosing an accountant, selecting a lawyer, deciding whether or not to hire staff...the list goes on. But choosing the perfect partner for your distribution channel is especially challenging. So, what makes one option superior to another? Let's consider three key points.
1. Cost Savings - Most companies realize significant reductions in overall expenditures when they utilize distributors. Why bother paying $100 per month for a warehouse space when you can pay $50 and gain access to hundreds of outlets around the world?
2. Speed - Working with distributors gives you access to a massive network of providers. These networks include countless manufacturers, wholesalers, and retailers.
3. Expertise - Having a team of experts behind you ensures that you always stay on top of the latest developments in your field. No matter how fast your competitors are moving forward, you'll remain ahead thanks to decades of experience.
Now that we've covered the basics, here are some tips to bear in mind whenever you plan to work with a distributor. First, remember that you shouldn't expect miracles overnight. In fact, you should prepare yourself for slow growth initially. Second, set realistic expectations. Don't put undue pressure on your chosen vendor. Third, trust that they'll guide you through the process. Lastly, take care to establish clear goals, and communicate regularly with your representative.
Become CEO of your own lead generation software company, just follow our battle-tested guidelines and rake in the profits.