Lavender delivers products to their customer at a distributor
rate.
What is the distributor rate and why it is cost-effective?
The company always gives their products to their registered
distributor. Then the distributor sells products to the wholesaler, then the wholesaler
sells those products to small traders, then those traders sell products to
local shop keepers, and then people buy those products from those shops.
When a company sells products to the distributor the price tag is quite low, afterward
when the distributor sells those products to the wholesaler cost is increased which
includes the labor cost, transportation cost, rent plus government tax. Then
the same procedure is followed by the wholesaler to the trader and then trader to
local shops.
This way product cost is increased because of this expensive
process and people buy expensive products from local shops and of course, the
local shop owner also set his margin on the products.
For Example:
When a company manufactures a product like shampoo
you will see two price tags on the packaging of the bottle. One price tag is for
distributors and the other is for the people. If one 200ml shampoo price is 190
for distributor then it will be 240 for the people. This cost difference is
because of the transportation, rent, labor cost, government tax, and the more
parties involved. This price difference is applicable to all products of
companies. Now the point is how Lavender is reducing the cost?
Lavender is shopping all kinds of products for you at
distributor price and also providing the home delivery services.
