The Retailer is a middleman between the wholesale and the consumer. He is the last link the chains of distribution as he comes in direct contract with the consumer. He gets his supplies, when he buys from the manufacturer he buys in smaller quantities than the wholesaler because his capital is usually smaller and his sales to consumers are in small quantities.
Services to Manufacturer and Wholesalers
1. The retailer helps the producer and the wholesaler by getting the goods actually distributed to consumers.
2. As he comes in contact with various consumers, the retailer studies their tastes and special requirements and reports accordingly to the producer either through the wholesaler or directly. This enables the producer to improve the design or quality of his goods. Thus the producer can concentrate on production and not try to keep track of chances in taste and fashion.
Services to the Consumer
The consumer gets the following advantages by buying from a retailer: –
(i) The retailer gives various services to the consumer such as advice as to the suitability or durability of the goods, ‘free home delivery and after-sales service.
(ii) The consumer can get better and personal attention from retailers regarding complaints about the quality or quantity of goods.
(iii) As the retailer stocks a variety of articles from various manufacturers, the consumer has the opportunity of selection and examination before making his purchase.
(iv) As the consumer can buy in any quantity from the retailer, the consumer need not buy more than necessary for his immediate requirements whereas if he had to buy from a wholesaler or manufacturer he would have to buy in a sufficiently large quantity which would be very difficult if his financial position was weak or his storing space small.
(v) The retailer is in a better position to know the consumer as he is in closer contact with the consumer who very often resides in the same locality. He is therefore in a better position to grant credit terms to the consumer.