Wholesaling and retailing

Wholesalers are the institutions which stand between the manufacturer and the retailer. Wholesaling provides channels of distribution which help to bring goods to the market. Wholesalers act as middlemen between manufacturer and retailers. They buy goods in bulk from the manufacturer at a low price and sell them in small quantities to retailers. Wholesaling simplifies the process of distribution. As wholesaler handles a large assortment of goods from many manufactures, he reduces the problem of both manufacturers and retailers.

Wholesalers are used for information and advice. Suggestions which customers make to the retailer are passed to the wholesaler who conveys them to the manufacturer. Thus, the producer can improve his product.

The wholesaler keeps stock. Shoppers like to obtain goods immediately. This requires stock. Neither the producer, nor the retailer has extensive storage facilities and responsibility falls on the wholesaler. More over, the wholesaler arranges imports from abroad. Foreign manufacturers can rarely ship parcels to individual retailers abroad. They prefer to deal with a wholesaler, an import merchant with established trade connections.

Retailing is selling goods and services to the ultimate consumer. There are several types of retail institutions: specialty stores, supermarkets, general merchandise and non-store retailing.

Specialty stores sell one type of product, such as clothing, jewelry, furniture, books. These stores compete against giant department stores. They can adjust more quickly to market conditions.

Big supermarkets are usually well located. All the goods are arranged on trays and shelves. All the prices are clearly marked. The goods are ready-weighed and beautifully packed. There you can find everything you need.

General merchandise stores (GMS) carry a wide variety of products. There are three types of GMS: department stores, discount stores, hypermarkets.

Big department stores started in America more than 50 years ago and then the idea was brought to European countries. Department stores sell a wide range of goods. They are usually found in city centers and often charge high prices. These stores are wonderful places. People can do all their shopping under one roof. All the things for sale are displayed so that they can be easily seen and the customers walk around and choose what they want.

Discount storesspecialize in a narrow range of items. Low price is the major attraction of the discount stores. These stores are found outside city centers but near main roads so that customers can easily get to them. A lot of money is spent on advertising and detailed price lists are often shown in newspaper advertisements. Discount stores sell the most popular items, colors and sizes. The stores keep long hours and usually open on Sundays.

Hypermarket is a type of discount store that was developed in Germany. They are very large stores with low-price and high-turnover products. Hypermarkets are found on the edges of towns but near main roads in order to attract customers from a wide area. They are self-service, selling a very wide range of goods including groceries, clothing, gardening equipment and televisions. Hypermarkets achieve cost savings by simplifying their unpacking and display.

There are some major types of non-store retailing: vending machines, door-to-door sales and catalogue sales.