A wholesaler is an intermediary business that purchases products in large quantities from manufacturers or producers and then sells them to retailers, other wholesalers, or industrial, commercial, or institutional users. The primary function of a wholesaler is to facilitate the distribution of goods from the manufacturer to the end consumer.
One of the main functions of a wholesaler is to purchase products in large quantities directly from the manufacturer or producer at a lower price. This allows the wholesaler to take advantage of bulk discounts and economies of scale, which can then be passed on to the retailer or other buyers. By purchasing in large quantities, the wholesaler is also able to negotiate better terms and conditions with the manufacturer or producer, such as longer payment terms or transportation discounts.
Another function of a wholesaler is to store and distribute the products they have purchased. This includes maintaining an inventory of the products and providing warehousing and logistics services to ensure that the products are delivered to the retailer or other buyer in a timely and efficient manner.
In addition to purchasing and distributing products, wholesalers may also provide value-added services to their customers. This can include things like product customization, packaging, and labeling. For example, a wholesaler may purchase bulk quantities of a product and then repackage it into smaller quantities for individual retail sale.
Another important function of a wholesaler is to act as a financial intermediary between the manufacturer or producer and the retailer or other buyer. This can include providing credit or financing to the retailer or other buyer, allowing them to purchase products on credit and pay for them at a later date.
Overall, the main functions of a wholesaler are to facilitate the distribution of goods, provide value-added services, and act as a financial intermediary between the manufacturer or producer and the retailer or other buyer. By performing these functions, wholesalers play a critical role in the supply chain, ensuring that products are delivered to the end consumer in a timely and efficient manner.
Characteristics and Function of Wholesalers
The shipping companies and owners of stock needed a trader who could take delivery of the entire load at the docks. Grading and Packing â A wholesaler sorts out the goods according to their quality, size, shape, content etc. Here we discuss how wholesaling works along with its functions, types, and examples and its differences from retailing. They break the goods into small lots, repack them and put their own brand names. The wholesaler buys different goods from different manufacturers and assembles them in a warehouse for selling it to the retailers. However, in these instances, either the manuÂfacturer or the retailer or in certain instances the customer performs all the activities that a wholesaler will perform. Some of the services they provide include delivery, management assistance, etc.
What are the main functions of wholesalers?
A manufacturer may indulge in opportunistic behaviour even when there is no asset-specific investment. Receiving dispatch orders from the principal d. Thus, the manufacturer is relieved from the botheration of selling in small quantities. When wholesalers acquire a good deal or a discount on purchasing items from a company, they pass it on to retailers. This is again an important charaÂcteristic, as bulk transactions imply handling most of the logistical functions such as storage, finance, and transportation at a much higher volume and scale than typical retailers. He can train the in-store team, improve retail displays and contribute his overall market knowledge to improve the overall business in a territory. I'm very happy to share my articles with my viewers and along with students too.
Wholesaler: Definition, Characteristics, Types, Functions, Services
Therefore, to avoid periodic shortages, a wholesaler keeps a large stock of goods for retailers. In this case the dealer is modifying the product and adding value to it. A retailer can use this type of information when it establishes its own related policies. For instance, if the manufacturer is located in north India and would like to sell to an industrial buyer located in a south Indian state, given the geographic and cultural distance, it will be very inefficient for the manufacturer to deal with the customer directly. Grading and Packing: The wholesaler sorts out the goods according to their quality. The wholesalers should develop an overall promotion strategy that includes advertising, sales promotion, publicity, and personal selling. Transportation â Wholesalers have to move the goods from the place of production to their warehouses and from there to the place of retailers.
What are the functions of Wholesaler?
Grading, packing and packaging â When wholesalers buy goods from agriculturists and from small and cottage industries, they also perform the function of standardization, grading, packing and packaging. Many wholesalers maintain their own warehouses for storing goods. These questions will determine market coverage and, consequently, market share of products. Risk Bearing Wholesalers absorb some risk by taking title and bearing the cost of theft, damage, spoilage, and obsolescence. Or else, the system connects directly to the customers. Risk-Assuming â Wholesaler undertakes the risk of manufacturers and retailers.
