Definitions of Merchants

The term merchant is most commonly associated with affiliate marketing however on The Reseller Network it covers any business wishing to grow through strategic relationships. We have outlined a few of the most common types of merchants below.

Manufacturer

A manufacturer is a company who manufactures or produces their own products. This encompasses all products including technology, software, food, textiles and much more. Manufactures tend not to sell directly to consumers and instead develop wholesale or distribution channels to take the products to market. Typically this means that manufacturers only take bulk trade orders.

Distributor

A distributor is part of the distribution channel and is effectively the link between manufacturer and retailer. A distributor will receive and distribute bulk orders between a manufacturer and a retailer. Historically a distributor would have only handled physical products however with the evolution of the internet there are now distributors for products or services such as flights, hotels, financial products.

Vendor or Supplier

Vendors and suppliers are effectively the same supplying products or services to resellers and distributors in the channel. The term vendor is very common with in the IT and technology channels however it applies to suppliers of any product. Typically a suppliers and vendors will supply products or services owned or manufactured by another company to resellers. As with distributors and wholesales they usually purchase goods in bulk and redistribute smaller quantities to a network or VARS, resellers and distributors for a profit.

Affiliate Merchant

An affiliate merchant is a company that wishes to drive traffic to their website or sales off their product through ads and links placed throughout a network of affiliates. Merchants will normally pay affiliates a commission for every visit to the website or every sales conversion. A merchant may run their own in house affiliate program or they may use an affiliate network. To manage affiliates in house a merchant would either develop a bespoke application or purchase affiliate tracking software to monitor sales and commissions. Traditional affiliate networks charge merchants a membership fee and also take an additional commission from every sale so it is much more cost effective to manage affiliates in house.

Wholesaler

Wholesalers are effectively both a reseller and a merchant because they buy goods from manufacturers or distributors and then resell the goods to retailers. A wholesaler will typically purchase goods in bulk shipments and redistribute the products to retailers in smaller quantities. Historically a wholesaler would operate out of a large premise such as a warehouse in order to store stock before distributing it to retailers however it is also now common place for a wholesaler to act as a broker without physically handling stock, the term for this is drop shipping.