Tag: middlemen 1 - wholesaler

Wholesalers are middlemen between the manufacturers and the retailers. They increase the cost of marketing and price of the products goes up. The consumers have to pay higher price. By eliminating wholesalers, prices of the products will decrease and the consumer shall benefit. The manufacturers will be earning more profit on account of lesser prices of the products.

Elimination of Wholesalers:

1. Wholesalers are middlemen between the manufacturers and the retailers. They increase the cost of marketing and price of the products goes up. The consumers have to pay higher price. By eliminating wholesalers, prices of the products will decrease and the consumer shall benefit. The manufacturers will be earning more profit on account of lesser prices of the products.

2. Wholesalers are unnecessary links between manufacturers and retailers. Their presence in the distribution channel obstructs the smooth and quick delivery of goods from the manufacturers to the ultimate consumers. If they are eliminated, the unrestricted supply of goods takes place from the manufacturers to the retailers and the consumers.

3. During the slack seasons and scarcity in business activities demand, the wholesalers resort to hoarding and stocking of goods and sell them at exorbitant prices charging excessive profits.

4. In certain regions, the wholesaler is the sole distributor of the product. He occupies the monopolistic position and exploits both the retailers and the consumers by charging higher prices if the wholesalers are eliminated it would be in the best interest of both the retailers and the consumers.

5. Big and established retailers such as large departmental stores can afford to make their own purchases directly from the manufacturers without approaching the wholesaler. The wholesalers are easily eliminated.

Wholesaling, jobbing, or distributing is the sale of goods or merchandise to retailers; to industrial, commercial, institutional, or other professional business users; or to other wholesalers and related subordinated services. In general, it is the sale of goods to anyone other than a standard consumer.

Middlemen include wholesalers, retailers, agents and brokers. Wholesalers and agents are closer to the producers. Wholesalers buy goods in bulk and sell them to the retailers in large quantities. Consumers may also choose to bypass the intermediaries and buy goods directly from the producers.

Non-Trading Organizations. A business concern is an organization involved in activities of buying or selling goods and services with a view of making a profit. There are associations, clubs or societies which are not formed for the purpose of making profit. These are called non-trading organizations..

The advice given by someone who has studied a subject thoroughly or who is very skilled at a particular job. You should seek expert advice before going into business. If you are travelling to a malarial area, get expert advice before you set off.

They help move goods between producers and retailers and the advent of modern technologies help them do this more efficiently. A wholesale merchant operates in the chain between producer and retail merchant. Some wholesale merchants only organize the movement of goods rather than move the goods themselves.

The main exchange functions are buying and selling. Both buying and selling functions have their primary objectives as the negotiation of favorable terms of exchange. This function is concerned with seeking out the sources of supply, assembling of products, and activities associated with purchase.

A mercantile agent is a person who is appointed by those in business to act on their behalf or to represent them in dealing with other persons. The person on whose behalf he acts as an agent is known as the 'Principal'.