Value-added distributor
Reviewed by Dasha ShakovVP Marketing, Proton
Updated
What is value-added distributor?
A value-added distributor is a distributor that does extra work on what it sells, such as assembly, kitting, cutting to length or custom labeling. Technical design help and on-site inventory management count too, and these services make the distributor harder to replace with a cheaper source of the same products.
Value-added distributor example
For a hospital job, an electrical distributor cuts wire to length, pre-assembles fixtures and labels every box by floor and room. The contractor pays slightly more per item and saves days of labor on site.
Related terms
- DistributorA distributor is a company that buys products in bulk from manufacturers, holds them in stock and resells them in smaller quantities to other businesses.
- KittingKitting is grouping several separate items into one ready-to-use package sold under a single part number.
- Vendor-managed inventory (VMI)Vendor-managed inventory (VMI) is an arrangement in which a distributor or manufacturer keeps a customer’s stock filled to agreed levels.
- Cost to serveCost to serve is what it costs to do business with a particular customer beyond the products themselves, from sales calls to delivery and collections.
