a) Services rendered by wholesalers to producers / manufactures
The following services are rendered by the wholesalers to the manufactures:
- Distribution of goods: – Wholesalers undertake take the liability of manufacturers to distribute the goods produced by them. Therefore, they relieve manufacturers from this liability.
- Provide market information: – Wholesalers act as an intermediary between the manufacturer and the retailer. They provide market information regarding market condition, consumers’ demand, taste, preferences, behavior, etc., to the manufacturers at the appropriate time, so that the manufacturer/producer can regulate and adjust the production schedule accordingly.
- Helpful in financial assistance: – The wholesaler provides financial assistance to the manufacturers by rendering them advance money for the goods.
- Helpful in large-scale production: – The wholesalers help in increasing the sales of goods by purchasing the goods from producers in large quantities. So, the producer gets the benefit of large orders and he can also produce on large scale. With this, he may also reduce the cost of production.
- Helpful in expanding the market: -The wholesalers distribute the goods produced by the manufacturers in different segments of the market. They try to sell these goods in new market also. It is the wholesaler who makes the goods produced by a manufacturer available in all parts of the Thus, wholesalers help in expanding the market for products and sales of such goods.
- Benefit of advertisement: -The wholesaler undertakes extensive advertisement for the goods purchased from producer. It helps the producer in increasing the sales of their products and re-doubles the effect of advertisement.
- Helpful in price determination: – As wholesalers are in close touch with the retailers they can be very helpful in determining the price of products.
- Helpful in price stabilization: – A wholesaler stock goods during the harvest season and sell them during the period of peak demand. In this way, he contributes a good deal to the stabilization of prices and violent fluctuations in prices are prevented.
- Facility of storage and transportation: -The wholesalers take over the liability of producers of storing goods also. They store the goods manufactured by the producers in their own godowns and deliver the goods to retailer or consumers when require. Thus, the producers are relieved from the liability of storing and transporting the products.
- Risk Bearing: – A wholesaler bears all the trade risk arising out of sudden fall in prices of goods or by way of damage during storage, etc. He also bears the losses occurs due to change in fashion, taste, needs, etc., of the market. Similarly, loss on account of bad debts due to credit sales is also borne by a wholesaler.
- Time Utilities: – They create both time and place utility through their warehousing operation.
b) Services rendered by wholesalers to retailers
A wholesaler provides the following services to the retailers:
- Benefit of advertisement: -Usually, the wholesalers advertise for the products dealt with by them. Such advertisements are very helpful to the retailers because it increases their sales and profits in the market.
- Helpful in making selection: -A wholesaler generally maintains large variety of products, which helps retailers in making the selection of variety.
- Valuable consultation: -A wholesaler advises retailers on their marketing problems time to time. He advises the retailer when to buy, how much to buy and at what time to buy. He also informs retailers about the changes in the existing products, which in turn increases sales and profit of retailers.
- Helpful in purchasing the goods according to need: -As the goods are purchased by the wholesalers in large quantities and sold to the retailers in smaller quantities, the retailers get the facility of purchasing the goods in the quantity of their need.
- Facility of packaging: – The wholesaler undertakes the function of packaging of goods according to the specifications suggested by retailers. It helps retailers in selling these goods to the consumers in different size or quantities.
- Facility of sorting, grading and standardization: -The activities of sorting, grading and standardization are performed by the wholesalers. It relieves the retailers from undergoing these functions.
- Facility of transportation: The wholesaler provides various services to retailers in the form of free transportation and after sales services, etc.
- Introduction of new products: – He informs retailers about the launch of new products through advertisements, through price lists or through their travelling salesmen, etc. It helps the retailer in efficient window display of the new products in his job.
- Benefit of specialization: -Generally, the wholesaler deal in limited products or in a particular line of products. He possesses specialized knowledge about the products. This specialized knowledge is passed on to retailers which is very helpful in selling the goods to the consumer.
- Helpful in financial assistance: -The financial resources of retailers are generally limited. The wholesalers provide valuable financial assistance to them by selling the goods to them on credit. It helps the retailers in maintaining rotation of their working capital.
c) Services rendered by wholesalers to consumers
Some of the services provided by wholesalers to the consumer are as under:
- The wholesaler is instrumental in providing goods in accordance with tastes, fashions, demand and preferences of consumers, which increases the standard of living of the consumers.
- The wholesaler maintains equilibrium in the demand and supply of products.
- The wholesaler undertakes the function of marketing research which helps in improving the existing products and informing new uses of the product to the consumer.
- Through the advertisements of the wholesalers, customers get the information about the arrival of new products and their users.
- A customer can purchase goods at reasonable prices as the wholesalers help in price stabilization.
- The wholesaler possesses ample quantity of goods in the stores; it minimizes the probability of scarcity of goods in the market.