Distinguish between a commission agent and a delcredere agent?
Commission agent: As the name suggests, he is the one who takes certain amount as a commission for performing his duty. Various functions are also performed by the commission agent as storage, grading, packaging etc. He is said to be a middlemen who sells goods by acting as an agent to the owner of the goods. He receives remuneration on commission from his principal as a percentage of the value of goods sold after rendering his services. His duty is to take and keep the goods with him, negotiate the terms and conditions of sale with the potential buyers and finally hand over the goods to the buyer.
Del Credere Agent: He is that mercantile agent who sells the goods on credit and has to bear the loss that may occur due to the bad debts. In this case, owner is not harmed and is protected against such a loss. If such an agent sells goods on credit basis after taking the prior permission of the owner, he will not be responsible for any loss that may occur due to the non-payment by the buyers. In such a case, it is the owner who has no other choice but to bear the risk. An additional commission called del credere commission is the fixed percentage of amount of credit sales which is given to del credere agents so that he can bear the risk of bad debts.