Meaning of Wholesaler
Most of the consumer goods reach the hands of ultimate consumers through wholesalers and retailers. Similarly, in the marketing of industrial as well as agricultural goods wholesalers occupy a place of significance. As a matter of fact, channel of distribution is the route or path through which the product passes in its journey from producer to consumer (or user) and wholesalers and retailers are the important stations on this route.
This whole journey of the product is concerned with the flows of physical possession of ownership and title transfer, negotiation, financing, information, risk taking etc. all the functions of marketing, that is, the functions of exchange – buying and selling; the functions of physical supply – transportation arid storage; and facilitating functions – financing, risk taking, market information and standardization – are performed in the process of the product passing through the channel.
Definition of Wholesaler
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The 1954 Census of Business (U.S.A) defines wholesale trade as “marketing or selling merchandise to retailers, to other wholesalers, or to industrial, commercial, professional or other institutional users in contrast to selling to household consumers; to individuals for personal use or to farmers”.
On the basis of the functions or wholesaler in the marketing of manufactured goods, a wholesale trader may be defined as a trader who purchases goods in large quantities from manufacturers and resells to retailers in smaller quantities.
In the words of Evelyn Thomas, “a true wholesaler is himself neither a manufacturer nor a retailer but acts as a link between the two”.
The Role of Wholesaler
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The wholesaler’s primary function is to sell a product to a retailer for resale. Therefore, he perceives the product in terms of profits likely to be gained by his retailer customers. He tries to procure a given product for his customers at the lowest possible price. Also, he provides a number of services to enable his customers to be commercially successful. In relation to his manufacturer suppliers, through his distributive position in the middle, between the point of sale and the point of manufacture, “he facilitates the realization of’ the economic purpose of a product, that is, to earn profits for its manufacturer.