Wholesaling

• Wholesaling includes all the activities in selling

goods or services to those who buy for resale
or business use
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• It excludes manufacturers
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and farmers
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because they
production, and it excludes retailers.
Differences between wholesaler & retailer

• Wholesalers (also called distributors) differ

from retailers in a number of ways.
1) Wholesalers pay less attention to promotion,
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atmosphere, and location because they are
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dealing with business customers rather than final
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consumers.
2) Wholesale transactions are usually larger than
retail transactions, and wholesalers usually cover
a larger trade area than retailers.
3) Wholesalers and retailers are subject to different
legal regulations and taxes.
 Major wholesaler types
1. Merchant wholesalers: Independently owned
businesses that take title to the merchandise
they handle. r
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2. Full-service wholesalers:
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Carry stock, maintain
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a sales force,r offer
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provide management assistance.
3. Limited-service wholesalers: sell a limited line
of fast-moving goods to small retailers for cash.
 Contd…
4. Brokers and agents:
• Brokers bring buyers and sellers together and
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assist in negotiation; they are paidrby the
party hiring them—food th i Sa
brokers, real estate
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brokers, insurance
• Agents represent buyers or sellers on a more
permanent basis.
 Contd….
5. Manufacturers’ and retailers’ branches
and offices: Separate branches and offices
dedicated to sales or purchasing.
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6. Specialized wholesalers:
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assemblers (buy
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the agricultural output of
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many farms), petroleum bulk plants and
terminals (consolidate the output of many
wells), and auction companies (auction
cars, equipment, etc., to dealers and other
businesses.
 Wholesaler functions

• Selling and promoting • Transportation

• Buying and • Financing
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assortment building • Risk
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• Bulk breaking Dee • Market information
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• Warehousing • Management services
and counseling