Contactor is an acronym for “contactor company.” These companies offer a wide variety of services to the cosmetic industry. They deal with everything from packaging and labeling to warehousing and shipping. In the past, contactors handled all the warehousing and shipping, too. Today, many of these functions are being handled by the manufacturers themselves.
Suppliers who do business with contactors must understand that the service is not free. The contactor will collect fees for the services provided and will pass these along to the manufacturer. The fees are passed along in the form of higher prices for products, which is why it is important to negotiate and make sure you are getting the best possible deal.
The Difference Between a Manufacturer and a Distributor
Manufacturers are the companies that actually produce cosmetics. A manufacturer may also be a packer and shipper, but this is not the same as being a distributor.
A distributor is a company that purchases products from the manufacturer and resells them to the end user. The distributor may also be a wholesaler or a jobber. Wholesalers usually sell to retail stores, and jobbers sell to drugstore chains.
Types of Distributors
There are three main types of distributors:
• National distributors
• Regional distributors
• Local distributors
National distributors offer a large variety of products and services to the cosmetic industry. They are located throughout the country.
Regional distributors offer a limited variety of products and services. They are located in one area of the country.
Local distributors offer very few products and services. They are located in one area.