WHOLESALING

• Wholesaling is concerned with the activities of those persons or establishments that sell to retailers and other merchants and / or industrial, institutional and commercial users but do not sell in large amounts to consumers.

– US Bureau of Census

• Selling and promotion• Bulk breaking• Warehousing• Transportation• Financing• Risk bearing• Market information• Management services and counseling

• Selling and promotion• Bulk breaking• Warehousing• Transportation• Financing• Risk bearing• Market information• Management services and counseling

Types of Wholesalers

1. Merchant wholesalers Full service wholesalers

Wholesale merchants

Industrial distributors

Limited service wholesalers

Cash and carry wholesalers

Truck wholesalers

Drop shippers

Rack jobbers

Producers co-operatives

Mail order wholesalers

2. Brokers and Agents

Brokers : Chief function is bringing buyers and sellers together and assisting in negotiation. They are paid by the party who hired them & do not carry inventory, finance goods or assume risk.

Eg: food brokers, real estate brokers & insurance brokers.

Agents

manufacturers agents

selling agents

purchasing agents

commission merchants (agricultural marketing)

3. Manufacturers and Retailers’ branches and officesSales branches & Sales offices Purchase offices

• Not too worried about location, ambience or promotions – prefer to be in the main market.

• Deal with other businessmen and not consumers.

• Deal with a specific group of products only.

• Much larger trading area.

• Much larger transactions with suppliers and retailers.

• Believe in low margins but high volumes.