Rack Jobbing

Definition: The selling of another company's products through a distribution system of racks in a variety of stores that are serviced by the rack jobber

In a typical rack-jobbing business opportunity, the agent or buyer enters into an agreement with the parent company to market their goods to various stores by means of strategically-located store racks.

Under the agreement, the parent company obtains a number of locations in which it places racks on a consignment basis. It's up to the agent to maintain the inventory, move the merchandise around to attract the customer, and do the bookkeeping. The agent presents the store manager with a copy of the inventory control sheet, which indicates how much merchandise was sold, and then the distributor is paid by the store or location that has the rack, less the store's commission.

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