Definition of Agent: Characteristics, Strengths, and Weaknesses

Definition of Agent – In everyday life, the word agent has often been heard before. Even though it is quite familiar to use, many people do not understand the meaning and meaning of this word. The use of the word agent is usually used to refer to parties who act as intermediaries, such as insurance agents or travel agents.

Then, what exactly is meant by an agent? On this occasion, we will discuss agents, starting from their understanding, characteristics, and differences from distributors. So, read this article to the end, Sinaumed’s.

Definition of Agent

An agent is a person or business entity appointed and authorized or authorized to represent and act on behalf of another business entity. For example, a business entity such as a bank that acts and acts as an agent. This person or company will act as an intermediary for the party showing it. The goal is to seek sales for the party or company that appointed it.

In the Big Indonesian Dictionary (KBBI), an agent is an intermediary person or company that seeks sales for other companies on behalf of entrepreneurs or representatives.

In other words, the party who becomes an agent acts as a representative of the name or company in principle to offer services and services, and is subject to the provisions regarding the extension agreement.

Agent Characteristics

Agents do not only refer to individuals, companies or institutions. A person or business entity can be said to be an agent if it has the following special characteristics:

  1. The marketing area is not too broad.
  2. The amount of goods sold by agents is generally smaller than distributors.
  3. Agents buy goods in large quantities to be resold to resellers.
  4. Agents can open opportunities to become resellers to other parties.
  5. Agents are not always in the form of a business entity or have a business entity permit.
  6. The purchase system for the goods or services offered has a drop-out or commission buying system.
  7. Usually agents do not serve direct purchases by consumers.
  8. Agents only sell products from one manufacturer and may not sell products from competitors.
  9. Patents are fully owned by the party showing them, and cannot determine the price of the goods or services.

This also applies to insurance agents and travel agents. They cannot claim if they own or are part of the company that appointed them. They also cannot set fees or prices on the services or services they offer. In other words, they must follow the fee or price set by the authorizing party. The profit earned on the two agents is generally a commission.

Agent Duties and Responsibilities

There are several duties and responsibilities carried out by an agent, such as:

  1. Establish marketing plans and goals.
  2. Looking for customers, both retail stores and resellers.
  3. Provide a full range of services for customers, such as consulting and technical assistance.
  4. Identify and define priority customers.
  5. Perform persuasive actions and answer customer questions.
  6. Provide information related to product knowledge to customers.

Difference between Agent and Distributor

Many people misunderstand and think that agents and distributors are the same, even though these two words have different meanings. Then, what is the difference between an agent and a distributor?

Unlike agents, distributors are entities that act as intermediaries between producers and other entities. The goal is to support the distribution channel or supply chain of goods to be distributed to consumers. Not only appointed, they also have a business relationship with the manufacturer or producer they represent.

So, the distributor is the first chain after the manufacturer. Unlike agents, distributors act as sellers of these goods to consumers. They profit from the difference in selling prices, not commissions. Meanwhile, agents, benefit from the deals that have been done.

Distributors also have leeway in determining the price of goods, unlike agents who have their own pricing provisions.

Classification of Agents from their Practice System

Agents have a broader context. When viewed from the practice system, agents are divided into two groups, namely complementary and supporting agents. Then, what differentiates the two? Let’s see Sinaumed’s:

1. Complementary agents

These agents provide additional services in the distribution of goods. This function is in carrying out additional services in the distribution of goods. The goal is to be a complement when there is a shortage. For example, if a trader or business institution cannot do things related to the distribution of goods, then this auxiliary agent will do it.

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If traders or other institutions cannot carry out work related to the distribution of goods, then auxiliary agents replace them.

In addition, there are many services included as complementary agents. The services offered also vary. For example, there are agents who help in the field of financial consulting, this agent’s role is to assist clients in matters of the financial sector.

In addition, there are also agents who have services in assisting decision making. Examples include agencies or advertising agencies. There are also agents whose role is to assist in the provision of information. For example television, newspapers and radio.

2. Support agent

Supporting agents as agents who play a role in assisting the process of moving goods in such a way as to create a direct relationship between buyers and sellers. The support agency plays a role in serving the needs of each group simultaneously. Some examples of support agents include the following:

  • Bulk transportation agent .
  • Storage agent .
  • Special transportation agent (specialty shipper).
  • Purchasing and sales agents (purchase and sales agents).

The activities carried out by this support agent are to assist in the transfer of goods in such a way that they can establish a direct relationship between the buyer and the seller. Thus, the function of the support agency is to serve the needs of each group simultaneously.

Types of Agents in the Shipping Industry

In addition to the types of agents above, there are also other types of agencies, including the following:

1. General agent

A national shipping company appointed by a foreign shipping company to serve ships belonging to the foreign company while sailing and stopping at Indonesian ports. For example, a Japanese Cingcuala shipping company appointed Bahtera Line as an agent. So, Bahtera Line has the task of serving ships belonging to Cingcuala while sailing and stopping at Indonesian ports.

Requirements as a general agent are Indonesian shipping companies that have an Indonesian-flagged ship of at least 5,000 BRT and/or an Indonesian-flagged ship of at least 5,000 BRT cumulatively and have evidence of an agency agreement or have evidence of a general agency letter . of appointment).

Maritime companies appointed as general agents are prohibited from using the space of foreign ships they are agents for, either in part or in whole, to lift cargo on domestic ships.

2. Agent branch

Is a branch of the general agent at a particular port. In business on commercial shipping where there are liners and trampers. Liner shipping will appoint a general agent or booking agent, to take care of the cargo and the ship. Tremper will show a special agent because it is only used when the ship is chartered at a port where the ship is loading and unloading.

In carrying out its duties at the port, the designated agent is called the port agent. The port agent appointed at another port can appoint a sub agent to represent it. The port agent remains responsible for the principal. If in a charter party, one party to the charterer has appointed an agent to represent his interests, then the owner can appoint another agent to represent him, which is called a protecting agent.

3. Sub-agents

Shipping companies appointed by the general agent to serve certain needs of ships at certain ports. This sub agent actually functions as a representative or agent of the general agent. For example, Cingcuala appointed Bahtera Line as its agent, so Bahtera Line appointed Jaya Line’s sub-agent to replace the ship, because Bahtera Line did not have a branch at the Port of Merak, Banten.

4. Husbandry agent

The agent appointed by the principal to represent him outside of the interests of loading/unloading, only takes care of the ship’s crew, repairmen and so on.

General Types of Agents

Because the types of agents are divided into several, the following are the types of agents in general, namely:

  • General agent, providing various kinds and types of goods means not focusing on one type of goods.
  • Agricultural products and plastic agents, providing various kinds of agricultural products/spices such as herbs, cake ingredients, nuts and also providing various kinds and types of plastic.
  • Agent sandals, providing various types of sandals.
  • Drug agency, providing a wide range of drugs-
  • Toys agent, an agent that sells various kinds of children’s toys
  • Book and stationery agent, providing various kinds and brands of books and stationery.
  • An electric pulse agent, providing electric pulses that are easy and fast to obtain.
  • A hawker agent, providing a complete range of types of snacks.
  • LPG gas agents, provide LPG ready to deliver and pick up to addresses.
  • Beverage agents, providing various types of drinks.
  • Rice agent, providing and selling various types of rice.
  • Home appliance agent, providing a wide range of household appliances.
  • Electronic agents, provide electronic payment service facilities to make it easier and faster to make a transaction.
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Electronic agent as a device of an electronic system that is made to take action on certain electronic information automatically which is held by many people.

Requirements to Become an Electronic Agent

Electronic agents can be held for more than one interest of the electronic system operator based on an agreement between the parties. This means that the electronic agent can expand its business in other fields which are electronic transactions. The agreement made by the agent must contain at a minimum:

  1. Rights and obligations;
  2. Responsibility;
  3. Grievance mechanism and dispute resolution;
  4. Time period;
  5. Cost;
  6. Service scope; And
  7. Choice of law.

Electronic system operators can operate their electronic systems themselves or through electronic agent operators. Electronic agents can take the form of:

  1. Visual;
  2. audios;
  3. Electronic data;
  4. Other forms.

In addition, electronic agents are also required to contain or convey information to protect user rights which at least includes information regarding:

  1. The identity of the electronic agent operator;
  2. Transacted object;
  3. Eligibility or security of electronic agents;
  4. Procedures for using the device; And
  5. Complaint center telephone number.

Electronic agents must load or provide features in order to protect user rights according to the characteristics of the electronic agent used. Features can be facilities for several things:

  1. make corrections;
  2. cancel orders;
  3. Provide confirmation or reconfirmation;
  4. Choose to continue or stop carrying out the next activity;
  5. View the information submitted in the form of a contract offer or advertisement;
  6. Check the status of successful or failed transactions.

Electronic Agent Registration

In registering an agent, there are several conditions and must pay attention to the principles, including:

  • caution;
  • Security and integration of information technology systems;
  • Security control over electronic transaction activities;
  • Cost effectiveness and efficiency;
  • Consumer protection in accordance with statutory provisions

Providers are also required to have and carry out standard operating procedures that comply with the principles of controlling the security of users and electronic transactions. The principles of securing user data and electronic transactions include:

  • confidentiality;
  • Integrity;
  • Availability;
  • Authenticity;
  • Authorization

In addition, agent operators are also required to carry out, own and carry out identity authentication tests and check the authorization of electronic system users who carry out electronic transactions.

Agent strengths and weaknesses

As with other business sectors, agents have several advantages and disadvantages. Where the advantage of being an agent is getting a sizable profit potential from sales and not needing to create a product with its own brand.

Meanwhile, the drawback of being an agent is a lot of capital because you have to have a place that is large enough or adequate for storing goods. Agents also have to bear the risk of loss if any goods are damaged during the storage or delivery process.

Form of Agreement with Agent

The existence of an agent is based as a special assignment. The agent’s specific duties are prospecting for customers, providing service, making presentations or persuading, planning and targeting and establishing priority customers.

Then, what is the form of the agreement between the company and the agent referred to as the company’s representative? In Indonesia, the form of agent agreement regulated in article 21 paragraph (2) of the Minister of Trade Regulation 11/2006 requires companies to enter into an agreement with an agent which is legalized by a notary. Things to pay attention to are:

  1. Names and full addresses of both parties working together.
  2. The aims and objectives of the collaboration.
  3. Describe agency status.
  4. Explain the types of goods or services in cooperation.
  5. Marketing area.
  6. Describe the obligations and rights of both parties.
  7. Authority.
  8. The validity period of the cooperation or agreement.
  9. Describe ways to terminate the agreement.
  10. Describe ways to resolve disputes.
  11. Applicable law.
  12. Completion grace period.

The word agent cannot be interpreted in a simple way, because agents have a fairly broad scope in many fields, both in terms of work and function. However, in principle agents are the accomplices and hands of a company or manufacturer in distributing and distributing the products being traded, both goods and services. It’s just that the agent does not have the authority to determine the selling price of the goods or services.

So that’s the meaning of the agent’s characteristics, as well as its advantages and disadvantages. From all the explanations above, it can be said that an agent is an intermediary who acts to market the goods or services of a company to consumers with the terms of the agreement and the conditions that apply.

If Sinaumed’s is still confused, and needs references related to the full meaning, characteristics, advantages and disadvantages of agents, you can visit the sinaumedia book collection at sinaumedia.com . Hopefully all of the discussion above adds to Sinaumed’s’ insight. So, after reading this article to the end, are you interested in becoming an agent?