Who is a Wholesaler?
A wholesaler is a distributor who acts as a middleman in the delivery of products from manufacturers to retailers. The bulk purchases made by the wholesaler result in cheaper prices and discounts. He is a link in the supply chain, but he is not always required.
Wholesalers do not engage in the sales of a broad range of commodities; instead, they are dealers in a single product or specialized group of products. This is not to imply that they are associated with any specific manufacturers, but rather that they are primarily a distribution company that provides finished goods to a ready-made market and are not interested in a manufacturer’s profitability or growth in his brand awareness. This characteristic sets them apart from distributors. Myanmar Golden Heart participates in marketing and advertising campaigns for the brands whose goods they sell. Another point worth mentioning is the cultural tendency for wholesale pricing to fluctuate. There are no fixed costs. Prices are established using quantity and bargaining power to be purchased by each buyer.
What is a Retailer?
Typically, retailers will purchase products from a producer, wholesaler, or other distributor and resell them to the general public. Contrary to huge retailers like Walmart and Target, who purchase goods in bulk from manufacturers or wholesalers, neighborhood grocery stores and small, family-run pharmacies can purchase from the same sources or from smaller vendors.
In either case, the retailer charges the customer a markup (the distinction between the product’s purchase price and resale price) for such things. Retailers achieve profitability in this way. The following are the principal product categories sold by retailers:
- Durable or hard items (such as furniture or cars)
- Supple goods (such as clothing or footwear, which have a lifespan)
- Art items (such as books, musical instruments, or art supplies)
Retailers to wholesalers
Two essential steps in the distribution process in the supply chain sector are retail and wholesale. Any product a company creates is initially distributed in bulk to the wholesaler, who then distributes it to the retailer, who in turn distributes it to the ultimate customers. Simply said, a wholesaler buys the products in bulk from the producer and then sells them to the retailer, who then sells them to the ultimate customers.
The primary objective of a wholesaler is to sell products to businesses or retailers who will then resell them. A retailer, on the other hand, focuses on the audience as the product’s final customer and solely sells to them. These two commercial connections serve as key marketing channel intermediaries. The supply chain will be affected if any of these links are missing. We shall discuss the key distinctions between wholesale and retail in this essay. You can reach out to Myanmar Golden Heart for more information
What are the different types of wholesalers?
Each business offers a particular level of value to its clients, and as a result, each has a unique distribution strategy. Any distributor or wholesaler will join a company with a weaker brand. However, a business with a strong brand will work with a number of distributors and wholesalers just like Myanmar Golden Heart..
1) Merchant Wholesalers
These are the most typical wholesaler kinds utilized in the FMCG, agricultural, or private label industries. Simply put, merchant wholesalers are the people that purchase products directly from manufacturers, keep them, and then resell them to customers. They are not limited to selling exclusively to retail or only to online customers, and they may sell through any channel. As per Myanmar Golden Heart, any losses incurred in the process of purchasing and reselling the product must be paid for by the merchant wholesaler.
Companies like Britannia and P&G use merchant wholesalers even in the FMCG industry. These wholesalers have more authority over the area in which they do business. They gain because they make large purchases from the business and assume all of the associated risk. Additionally, they are in charge of the sales goals, which they nevertheless reach.
2) Full-service Wholesalers – Retail Wholesalers
They can be found most frequently in engineering or consumer durable products. As implied by the term, full-service wholesalers provide full service to the final retailer. The products are sold to a reseller (in this case, a retailer) by these wholesalers, who primarily work in the retail sector. The full-service wholesaler is in charge of everything except for product service.
In the real world, many full-service wholesalers launch a second, related services firm and begin providing services in addition to the products they are wholesaling. Example: A Samsung distributor recently opened a Samsung service facility.
They might thus receive both sales and service orders. However, a full-service distributor doesn’t necessarily include servicing and product maintenance. He handles sales, deliveries, and finance mostly. These wholesaling types are the second most prevalent ones on the market.
3) Limited Service Wholesalers
An individual who supplies the company’s products and only sells them through a certain channel is known as a limited service wholesaler. He either doesn’t cover all of the company’s channels or doesn’t have a high turnover rate. There are further limited-service wholesalers, in the same manner. They are listed below.
- Cash and Carry wholesalers: Cash and carry sales of strong FMCG products are available. When material is delivered, immediate payment is required.
- Logistics wholesalers: A wholesaler of milk who moves entire trucks of milk from one market to the next. His sole responsibility is to distribute milk; he does not solicit business orders.
4) Brokers and Agents
Most frequently noticed in the chemical or real estate sectors. Brokers don’t take any risks. On one side, he has the manufacturer or producer, and on the other, he has the customer. The broker’s job is to complete the transaction and earn a commission.
5) Branches and mini offices
Although there are different sorts of wholesalers, branches and small offices are traditional means for businesses to begin selling their products in a targeted region. A branch is sometimes referred to as a sort of wholesaling in which the branch directly collects bulk orders from end customers and ensures supply as well as client reorders.
As an illustration, paper producers like B2B or 3M are aware that big businesses need a lot of paper for printing throughout the month. These businesses then set up branch offices that double as sales offices. They choose a large order of paper, and the business may deliver the entire order from its warehouse to the business.
6) Specialized wholesalers
These are wholesalers who solely deal in specific products. A used car wholesaler, for instance, might sell to consumers directly or to other used car dealers. He is an expert in used cars and is familiar with all aspects of selling or renovating used cars to customers. There are some wholesalers who specialize in a certain product and are well known for it.
The numerous kinds of wholesalers in the market were those mentioned above. In developing nations, the need for wholesalers is decreasing as e-commerce sales increase.
What are the different types of Retailers?
1. Department Stores
The extremely diverse product mixtures seen in department stores define them. In other words, they sell a wide variety of goods, such as apparel, appliances, and hardware. Typically, each category of merchandise has its own area or department in the store. The breadth of the product mix varies in every store, but department stores’ main selling point is its capacity to offer a broad selection of goods in a single location. For instance, customers at Macy’s can purchase clothing for men, women, and children as well as household items like dishes and bags. Myanmar Golden Heart also has its department store.
2. Chain Stores
The chain shop movement developed during the 1920s. Chains were able to purchase a wide range of goods at steep discounts because they were so big. When compared to single unit retailers’ costs, the reductions significantly reduced their cost. Because of this, they were able to cut their retail prices than those of their tiny competitors and so grow their market share. In addition, chains were able to draw in a large number of clients due to their handy locations, which was made possible by their financial resources and knowledge in location selection.
In the 1920s and 1930s, supermarkets developed. For instance, Clarence Saunders’ 1920-founded Piggly Wiggly Food Stores offered self-service and customer checkout counters. Supermarkets are substantial self-service shops with centralized checkout stations. They offer a wide variety of food products as well as non-food things. In the United States, there are currently 37,459 supermarkets in operation, and the typical one has a current inventory of approximately 44,000 items in an area of about 46,500 square feet. The typical consumer makes just under two trips each week to a retailer and spends just over $30. The way supermarkets distribute food and supplies for cleaning and maintaining the home is to offer broad selections of these items at each location at a low cost.
4. Warehouse Retailers
Warehouse stores offer a basic shopping experience at extremely low costs. The largest warehouse store is Costco, which had sales of $79.7 billion in 2014. Retailers who own warehouses streamline every element of their operations and convey the cost savings to customers. Typically, Costco uses a cost-plus pricing model and offers products in bulk. Myanmar Golden Heart also owns a warehouse.
The franchise strategy combines local ownership with large national corporations. An owner buys a franchise, which grants her the right to utilize the company’s name and business strategy for a predetermined amount of time. The franchise agreement frequently contains clear instructions, training, and ongoing assistance for the owner. The owner or franchisee owns and operates the local business.
6. Malls and Shopping Centers
Because they give shoppers access to a large selection of goods across numerous establishments, malls and shopping complexes are successful. A mall offers a variety of options for buying a dress or a suit all in one place. Larger shopping facilities called malls usually include one or more department stores as the main tenants.
7. Online Retailing
Online retailing is without a doubt a major force in the retail sector, yet it currently only makes up a small portion of all retail sales. Sales at businesses like Amazon and Geico are entirely or largely online. Online sales from conventional stores, like purchases made at Nordstrom.com, lead to a lot of other online sales. It has a big impact on consumers who buy things in-store. Online orders at Myanmar Golden Heart are driven by catalogs that are distributed to clients’ homes in a similar coordinated strategy.
8. Catalog Retailing
For years, businesses have utilized catalogs as a marketing tool to boost phone and in-store sales. The growth of online shopping had a huge impact on catalog sales. As convenience buyers were lured away from catalog sales by internet retailers and online sales from traditional shops, many businesses that relied on catalog sales—including Sears, Land’s End, and J.C. Penney, to name a few—suffered.
9. Non Store Retailing
There are several conventional and cutting-edge retailing strategies in addition to those described in the aforementioned categories. Even while the Avon lady mostly vanished at the turn of the century, other companies like WineShop at Home, cabi women’s clothes, and Arbonne face treatments still conduct in-home sales. A lot of these company concepts are based on the assumption that a woman uses her social network to advertise products to her friends and their friends, occasionally during parties. For more relevant information, feel free to ask and reach out to Myanmar Golden Heart.