Agent definition

What is an Agent?

An agent is an individual or business that acts on behalf of another party. This authority may be express (via an agreement) or implied. An agent may enter into contractual relationships on behalf of its principal. The agent may trigger a liability for the principal when acting within the scope of its responsibilities for that party.

Examples of Agents

Examples of agents are sales representatives and shipping agents. Another example is someone who enters into negotiations on behalf of a client.

Advantages of Agents

There are several significant advantages associated with using agents. First, agents are quite cost-effective, since there are rarely any fixed costs associated with them. Instead, agents are only paid if they perform a specific service for the principal. Also, they tend to have significant knowledge of local conditions, which makes them ideal for handling transactions in geographically dispersed areas.