3 Types of Wholesalers you can Choose for your Business

A wholesaler is a marketing intermediary that neither produces nor consumes the finished product but instead sells to retailers and other institutions that use the product for ultimate resale. A wholesaler’s primary function is facilitating either the transportation of or the transfer of title to the products. The wholesaler bears variety of names like distributor, stockiest, semi wholesaler, reseller, trader, jobber, merchant, agent, broker, etc.

Wholesaling is the distribution process of wholesaler getting large quantities of goods (either from the manufacturer or the agents) and selling them to the retailers or other professional businesses. In simple terms, wholesaling is the transaction of large quantities of goods between a wholesaler and the retailer or professional business where the good is bought for the resale purpose.

Distribution in China might be very different from the US. Thus, considering all these things, there are many types of wholesalers which can be used by any company.

Dropshipping Wholesalers

Dropshipping essentially means instead of buying inventory you display products – which are housed in the dropshipping wholesalers warehouse – on your own website. This type of wholesaler will complete the sale of a product but will have it dispatched from their supplier directly to their customer without actually handling the goods. People sell dropshipped products just about everywhere! Many sales on eBay and Amazon are fulfilled through drop shippers, as are items on thousands of eCommerce sites, especially smaller ones. Dropshipping wholesalers operate in bulk industries. They do not carry inventory. When they receive an order, they select a manufacturer who directly ships the merchandise to the customer. The title and risk is taken by the drop shipper from the time the order is accepted to the time it is delivered to the customer.

Merchant Wholesalers

These are the most common type of wholesalers used in the FMCG industry, agriculture industry or Private label industry. Quite simply, Merchant wholesalers are the ones who buy directly from the manufacturer, store the product and then sell it to the customer. They might sell in any channel and they are not restricted to selling to retail only or to online only. If there is any loss between the buying and selling of the product, it must be borne by the merchant wholesaler.

Manufacturer Wholesalers

Manufacturer wholesalers are the persons engaged in manufacturing activities as well as in distribution activities. The manufacturers activities as well as in distribution activities. The manufacturers who sell their goods to the retailers are known as manufacturer wholesalers. They may also make a large scale from other manufacturers so that the demands of retailers may be met. The main object to act as a manufacturer wholesaler is to play a double role in marketing. It increases their sales considerably. It also reduces their overhead expenses and increases their profits.

Before you even choose a wholesaler, or even before you choose the products you’re most interested in selling, it is crucial to perform some market research. Is the wholesaler reliable? Were products shipped on time? Does the wholesaler allow you to buy small quantities, or do they insist that you buy in huge lots? All of this information is important and will affect your bottom line.