Explanation:

The function of a distributor is to engage wholesalers and retailers in order to sell the products to end users. How many distributors a company appoints depends on the company and its purposes and goals. For instance, companies such as P&G and HUL deal with several distributors, while companies like Lamborghini, BMW, Rolex, and Mercedes appoint just a few distributors to cover a region. Moreover, they're known to typically enter into exclusive distribution agreements.

When there's an exclusive distributor agreement between a manufacturer and a distributor, the manufacturer isn't allowed to sell the product to other distributors except the exclusively authorized one. In the same vein, the distributor given an exclusive right to distribute a manufacturer's products isn't allowed to distribute or sell the products of the manufacturer's business rivals.