Services of a Wholesaler
A wholesaler provides valuable services
to manufacturers, producers, retailers and customers.
in Large Scale: A wholesaler buys goods in bulk and,
thereby, enables the producers to produce goods on a large scale. Large scale
production helps to reduce the cost of production per unit.
in Distribution: Wholesalers collect orders from a large
number of retailers scattered over a wide area and buy goods in bulk from
producers. He enables producers to reach customers scattered over different
parts of the country by distributing goods through retailers located in
different areas. Therefore producer can concentrate only on production.
Facility: A wholesaler holds large stock of goods in his
private warehouse or in a rented warehouse. In this way he relieves the
manufacturer from the function of warehousing.
of Demand: A wholesaler collects information from retailers
about the nature and extent of demand and passes it onto the producers and
enables them to produce goods according to the needs, tastes and fashions
prevailing in the market.
of Goods: Often wholesalers launch advertising campaign to
boost the demand for the goods. Producers get
the benefit of
such publicity and thus enabled
to spend less on advertising.
Assistance: A wholesaler often makes advance
payments to producers. He buys the goods as soon as they are produced.
Producers need not lock up their capital in maintaining huge stock of goods.
A wholesaler provides ready market to producers by placing advance orders and
relieves the manufacturer from the risk of loss due to fluctuation in demand
and storage of goods. He also reduces the risk by matching seasonal demand.
wholesaler serves as a useful intermediary between the producers and retailers.
Assistance: Wholesalers provide financial
assistance to retailers by selling goods on credit. This is done by allowing
credit to retailers purchasing goods from them and makes payment to them after
receiving money from their customers. This helps retailers to manage their
business with small amount of working capital.
the Requirements: Due to limited capital and lack of
space in his facility a retailer cannothold large variety of products. The
wholesaler removes this difficulty by selling goods as and when the retailer
of New Products: Wholesalers bring new products and
their uses to the notice of retailers. Thus retailers get knowledge about
innovated products and innovated features.
Stability: Wholesalers reduce price fluctuations by adjusting
supply and demand and save the retailers from loss arising from price
in Transport: A wholesaler often delivers goods at
the door steps of retailers and save their time and cost of transport.
Supply: Wholesalers keep large stock of varieties of goods
and provide a regular supply of goods as
per the retailer’s need. Retailers can purchase as much as they like, from time
to time and need not maintain a large stock of goods.