How does a distributor operate in international transactions?

A distributor in international transactions operates by ordering directly from manufacturers or suppliers, taking ownership of the goods, and managing inventory until those products are sold. This means that the distributor not only acts as an intermediary between the manufacturer and the end customer but also assumes the financial risks associated with holding inventory. By taking title to the products, the distributor is responsible for the storage, selling, and distribution of these goods.

This approach enables the distributor to have more control over pricing, marketing, and customer service, which is particularly important in international markets that can have varying regulations and consumer preferences. The ability to stock inventory also allows distributors to respond swiftly to market demand, fulfilling orders more efficiently and building stronger relationships with customers.

In contrast, other roles mentioned do not encompass the same level of ownership and inventory management. Some functions might involve selling on behalf of a company or providing logistics services, but these do not entail taking title to the goods, which is a key characteristic that defines the operations of a distributor.