2.2.1.1 Manufacturer's Agents
Completion requirements
The most common type of agent is a manufacturer's agent. These intermediaries are independent of the people they represent. They generally represent two or more producers with products not in direct competition. For example,
Coke® and Pepsi® are in direct competition. The same manufacturer's agent would not represent both. However, Pepsi and Snapple® are not in direct competition, and one agent could represent both.
Manufacturer's agents have little control over the strategies used for selling products (e.g., prices of products).
The more specialized services offered, the higher the commissions will be.
These specialized services may include
Agents charge higher commissions on new products. In these cases, manufacturers generally use their own sales employees rather than agents.
Manufacturer's agents have little control over the strategies used for selling products (e.g., prices of products).
The more specialized services offered, the higher the commissions will be.
These specialized services may include
- providing market information (especially when trading with foreign nations),
- arranging transportation for products, and
- promoting products.
Agents charge higher commissions on new products. In these cases, manufacturers generally use their own sales employees rather than agents.