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Agents in Business


AGENTS IN BUSINESS. An agent in the most general sense is any person who transacts business for another without being a direct employee, and in the majority of cases his function is to assist a principal in the purchase, sale or distribu tion of goods for a remuneration which usually takes the form of a commission on the price obtained. It is a term very loosely applied. Assistance may be rendered to principals irrespective of the commercial undertakings in which they are engaged. Con signment agents and credit enquiry agents are examples of this category as compared with factors or brokers who operate contin uously for principals in particular industries and with manufac turers' agents who are more particularly associated with special lines of goods. There is an intermediate class of agents not di rectly concerned with the sale of goods and therefore not remu nerated on a commission basis but who are of vital importance to the producer and manufacturer, the two most important being (a) advertising agents, whose function is to promote the com mercial activity which is the beginning and the end of every undertaking, and (b) patent agents whose services are needed in most cases before manufacture can be commenced and who are also in a position to introduce their clients to the agents best qualified to market the product.

Manufacturers' Agents.

Inthe early stages of a manufactur ing business when problems of production absorb the energies of the proprietor he is frequently glad to be relieved of all market ing problems by handing over the entire output to be disposed of by one or more manufacturers' agents on the commission basis which maintains this important section of the trading com munity. The method usually adopted is to sell by sample, the principal making arrangements for delivery and collecting ac counts. But some manufacturers' agents operate on a much larger scale, especially in the textile industry, maintaining ware houses, stock rooms and administrative departments. The inti mate knowledge possessed by the manufacturers' agent of the various requirements of the public is of great value to the princi pal; so much is this the case that the advisory services of the agent may be vital to the success of the undertaking and his influence on the policy of the business as powerful as if he were a partner. An agent of this standing is invariably consulted before new lines are introduced and he periodically brings forward sug gestions calculated to increase trade which will bring him in creased commission and the principal increased turnover.


The tendency of modern business is to shorten the chain between producer and consumer, the chief forces operat ing being the extension of advertising in all directions, the growth of consumer co-operation and the increase in competition which leads to producer co-operation and the formation of trusts or buying groups. The effect on the manufacturers' agent is for him to accept greater personal responsibilities and virtually to take over the functions of a factor who, whilst his remuneration is also on a commission basis, is much more independent of his principal than is the manufacturers' agent. Invariably the factor has possession of the goods of the principal; he is generally able to get a better price and sells the goods as though they_ were his own leaving the buyer no clue to identity. He also frequently acts as banker for his principal owing to the necessity of his carrying a large stock for disposal in anticipation of increased de mand. It is in his interests to induce the manufacturer to produce on a larger scale at a lower cost than if the production were small and this is done by his relieving the manufacturer of the necessity of recouping the expenditure of production with a quick sale. The factor is a large scale operator in a number of industries, pro duce, textile, grain, hide, etc., and like the manufacturers' agent is continually exposed to the pressure of the forces making for a shorter chain between producer and consumer. The tendency is for him to discharge other marketing functions, to buy up manufacturing businesses and do the work of a wholesale merchant.


A broker is an intermediary whose function is simply to buy or sell on behalf of a client and who does not have posses sion of the goods dealt with. He is present at all exchanges where produce is disposed of and business arranged. He has a special ized knowledge of particular classes of goods, their sources of supply and the avenues of marketing. His duties are of a personal character, only a small establishment being required as his busi ness is carried on by negotiation at the exchange and in the offices of clients. In the produce market brokers are indispensable— they study the crop reports, watch cargoes, take samples, collect statistics and furnish market reports. Pressure of competition and the shortening of the producer-consumer chain impels the broker to buy and sell on his own account.

Agency as a Career.

Employment as an agent in business on a commission basis is often the last resource of a person out of employment, without any connection to assist him to secure orders and foredoomed to failure or a precarious livelihood. The ambitious youth without capital should consider agency possibil ities as a stepping stone to greater remuneration as soon as he has been able to accumulate a reserve. A few years of training and experience in a merchant or factor's office will give him a knowledge of the methods of production and distribution of particular articles of manufacture until presently he has an oppor tunity of proving his value to his employer by suggesting new openings for agency development.

A new agency offers scope for ability and ambition to an ex tent presented by very few occupations. Whilst it is true that modern merchandising tends more and more towards larger units and the elimination of middlemen the increase of wealth every where creates new wants and an increasing market for new products. There were 30,00o applications for patents filed at the London Patent Office in the year preceding the World War and 3 2,00o in the year following it. The inventive genius is always bringing forward possibilities of marketing for which at first the agent is the natural instrument of development. The life is attractive to an adventurous spirit, a large circle of friends and acquaintances is formed and there is an excellent prospect of meeting the desired opportunity of entering the inner circle of the fields of manufacture and commerce. (See ADVERTISING

agent, manufacturers, principal, commission and market