How can you distinguish between wholesaler and retailer?

1. Link:

Wholesaler servers as a link between producers and retailers on the other hand, a retailer provides a link between wholesalers and consumers. Wholesaler is the first link, whereas retailer is the last link in the chain of distribution of goods.

2. Scale of operations:

A wholesaler carries on business on a large scale and requires huge capital. A retailer, on the other hand, deals generally on a small scale and capital invested in retail trade in relatively small.

3. Range of goods:

A wholesaler generally deals in one commodity. But a retailer deals in a large variety of goods and caters to the diverse needs of his customers.

4. Dealings:

A wholesaler generally sells goods to retailers on credit. But a retailer usually sells goods to consumers on cash basis.

5. Location:

A wholesaler can have a go down in a corner of the city and can supply goods there from. But the shop of a retailer needs to be located in the heart of the city to attract a large numbers of customers.

6. Profit margin:

A wholesaler has not to spend money on shop decoration etc., and has a large volume of sales. Therefore, he charges a smaller margin of profit than that charged by the retailer.

7. Display of goods:

A wholesaler need not display the goods. But a retailer has to display goods and decorate his shop in order to attract customers.

8. Impact on trade:

Goods sold by a wholesaler remain in distribution and are resold. On the other hand, goods sold by a retailer move out of the distribution channel and are finally used.

9. Source of supplies:

A wholesaler buys goods from manufacturers and their agents. On the other hand, a retailer generally buys goods from wholesalers and their agents.

10. Purpose of selling:

A wholesaler sells goods for resale. On the other hand, a retailer sells goods for ultimate consumption or use.