In industries such as composites, where many of the materials are made continuously and/or in large batches, shipments also must be large, in the form of truckloads or railcars, to make economic sense. From a practical standpoint, it's not feasible for a single supplier to fulfill many thousands of small orders to customers around the world. Enter the distributor, who buys large material quantities from a supplier/manufacturer, then creates smaller material units and delivers those units to many customers, in a timely fashion. They are distinct from brokers, who neither take delivery or nor title to the material, and surplus buyers, who typically buy aged material or overage and resell it at a discount.

Unlike big users that can buy truckload quantities direct from a supplier, most composites manufacturers have neither the cash flow nor the storage space to make that approach viable. The distributor, however, has both storage space and the resources to purchase product in quantity, as well as the equipment and personnel necessary to sort and package it in small orders. They can, in effect, manage the small manufacturer's inventory for him. Good communication between the distributor and customer ensures an unbroken supply chain, and helps the distributor manage his own warehouse inventory, to ensure timely material turnover and no dead stock or stock outs. Successful distributors, therefore, are shipping experts, using either their own truck fleets or cost-effective common carriers.

An important benefit provided to end-users is financing and credit, critical to both small and large businesses, particularly during down cycles, says one distributor's spokesman. Another is assuming the responsibility for product quality. The distributor's relationship both with the material supplier and hundreds (or thousands) of customers gives him leverage to resolve quality issues -- the supplier doesn't want to risk losing his customer base. Third, the distributor is knowledgeable about all of his suppliers' products, and can offer technical advice and training to his customers, to help them make the right material choices. He also can provide market intelligence, alerting end-users to price trends or impending shortages. The suppliers benefit as well, using use that intelligence to forecast demand or develop new products based on the distributor's widespread customer base.