Principal

Related terms

Manufacturers' representative

A manufacturers' representative is an independent sales firm that sells for several noncompeting manufacturers, called principals, in a defined territory and is paid commission on sales. The rep finds programs, manages RFQs, and handles communication between buyer and plant. The principal pays the rep, not the buyer.

Line card

A line card is the list of principals, or manufacturers, that a manufacturers' representative sells for, usually with each principal's processes and capabilities. Buyers use it to see which sources a rep can bring to an RFQ. Reps generally avoid carrying directly competing lines.

Commission

Commission is the percentage of invoiced sales a principal pays a manufacturers' representative for business the rep develops and services in a territory. Rates vary by industry, product, and deal size. Commission is usually paid monthly or quarterly after the customer pays the principal.