This is faster and allows the retailer or trader more time to focus on other aspects of their business, and ultimately improve the business and its profitability as a whole.
Manufacturers' sales branches and offices are owned and operated by manufacturers but are physically separated from manufacturing plants. As middle agents, wholesalers are only effective when the price they charge for goods and services is less than the value placed by customers.
According to the U. For starters, the cost of products is significantly lower.
Importance of wholesalers pdf
These medias have also played a major role in selling books, CDs and PCs etc. This can improve your business in a variety of ways. They also make immediate orders and quick bill payments to the manufacturers. If wholesalers fail to use electronic commerce to their advantage, they risk granting that wish. The three types of wholesalers are: merchant wholesalers; agents, brokers, and commission merchants; and manufacturers' sales branches and offices. They ordinarily have better storage facilities and can make more effective use of a given of space than the retailers. If the products or services are sold to the consumers, it can not be called wholesaling. Manufacturers' sales branches and offices are owned and operated by manufacturers but are physically separated from manufacturing plants. Merchant wholesalers may perform full range distribution tasks. Despite the emergence of so-called wholesale clubs aimed at the consumer market, wholesale trade typically involves business-to-business transactions. Merchant wholesalers are firms engaged primarily in buying, taking title to, storing usually , and physically handling products in relatively large quantities and reselling the products in smaller quantities to retailers, industrial, commercial, or institutional concerns, and to other wholesalers. The wholesalers aid their customers financially through open-book credit. Finally, the retailers are so small that for the manufacturers to send salesman to call on them would be prohibitive because of the great cost. This reduces the risk with price changes.
A brand that manufacturers or sources its own products will not use wholesalers, but they may distribute to wholesalers to get inventory in the marketplace. Financing Wholesalers also provide financing to its buyers by allowing them credit.
Wholesalers are constantly looking for productivity gains to benefit their customers and themselves and protect their position in the market place.
As a means to sell their goods, smaller producers must have avenues to develop market segments of potential customers and must make sure their goods are of the quality customers want at prices they are willing to pay. This reduces the risk with price changes. Sales office may be conveniently located in a market place. Financing Wholesalers also provide financing to its buyers by allowing them credit. According to the U. They are used primarily for the purpose of distributing the manufacturers' own products at wholesale. Manufacturers and service providers sometimes act as their own wholesalers. Some of the managerial services provided by wholesalers today include training of retail sales-clerk, advising on store displays and store layout, establishing better system of inventory control and accounting. It should also be noted that the possibility of a stronger negotiating position is possible, as some suppliers can be negotiated with. Ultimately, the wholesaler is trying to source valued products in bulk and at a very low price.
Wholesaling has the capability to adjust the distribution of goods from surplus to deficit areas.
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