Wholesaling
Wholesaling refers to all of the transactions in which products are bought for resale, for the making of other products, or for general business operations. A wholesaler is the individual or organization that facilitates these wholesaling activities by buying products and reselling them to yet another reseller, government agency, or an institutional user. As of 1999, there were approximately 512,000 wholesaling companies in the United States (1998), with more than half of all products sold in the country passing through these wholesaling firms. There were approximately 400,000 independent firms that handled close to $2 trillion worth of merchandise and employed close to 6 million workers.
Wholesaling is an important aspect of a company's marketing-channel strategy because it essentially involves the planning associated with industrial customers that need to distribute their products to manufacturers, retailers, government agencies, schools, hospitals, and other wholesalers.
Services Provided by Wholesalers
Because wholesalers are in the business of buying in large quantities and delivering to customers in smaller amounts, they are able to perform physical distribution activities more effectively, including materials handling, warehousing, and inventory management. They often offer quick and frequent pick-up and deliveries, as needed, which allows both the producers of the goods and wholesale customers to avoid the risks associated with holding large inventories.
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