Wholesaling and its importance, Types of Wholesalers - Merchant Wholesalers, Agents and Brokers, Manufacturer’s Wholesalers, Strategic Issues in Wholesaling - Target Market Decisions, Marketing Mix Decisions Trends Shaping Wholesale Distribution - Functional Overlap, Increased Services, Pricing and Credit,, Regional Coverage Organizational Form and Size, Impact of Information Technology on Wholesaling - Challenges in Wholesaling -Inventory Management, Sales Management, Promotion Management, Financial Planning and Management - Retailing and its Importance - Importance to Consumers, Source of Employment - Evolution of Retailing and types of retailing

1. WHOLESALING
&
RETAILING

2. What is Wholesaling?
Intermediary in the marketing channel
that sell to customers other than
individual or house hold consumers.

3. Contd….
 All the activities involved in selling goods and
services to those buying for resale or business
use.
 Wholesaler - those firms engaged primarily in
wholesaling activity.
 Wholesalers buy mostly from producers and sell
mostly to:
 Retailers,
 Industrial consumers, and
 Other wholesalers.

4. Definitions of Wholesaling.
Cundiff & Still : Wholesalers Buy and Resell the
Merchandise to the Retailer and other Merchants
and to the industrial , institutional and commercial
users but do not sell in significant amounts of
ultimate consumers.
S.E. Thomas : The Wholesaler or the wholesale
Trader Is a Trader who purchases goods in large
Quantities from Manufacturers and sell it to
Retailers in Small Quantities.

5. Wholesalers are Broadly Divided
into Two Types.
Freelance Wholesalers
Wholesalers working for Companies.

6. Features of Wholesalers
They operate on the Principle of Optimum Result of their
Effort.
They have Thin Margin of Profit
They are there to Minimize errors in Operations of the Company .
They Buy Goods for Resale
They Keep Inventory
They Take Risk of Price Changes
They Procure orders & Deliver them .
They Involve in Negotiation Process.

7. Features of Freelance Wholesalers
They are Usually Located in the Main Market.
Handle A large Assortment of Similar Products.
For Example Cement Wholesalers', Pharmaceutical Wholesalers &
Construction Material Wholesalers.
They do not Work for any Particular Company but they sell the Fast
Moving Products & Brands.
They Operate on Thin Margins
They Try to Negotiate Quantity Discounts from the Companies.
For Competitive Reasons they may even Sell the Goods by passing on
the entire discounts to Retailers.

8. Wholesalers Deliver Values
Wholesalers Keep Goods in hand that the
Customers need and have them accessible
instantly their customer can relay on their
inventory.
Though they always operate on the Low margin
and high Turn over at times they get together to
Bargain for better Terms.
•Ex: Kerala Distributors Association of All Goods &
Services.

9. Key Factors about Wholesalers
Wholesalers are Less bothered about the Location ,
Ambience or Promotions.
Their main focus is being in the Market and Extending
favorable prices and selective Credit to their Customers.
They Deal with Other Businessman & not Consumers.
They Deal with Specific Group of Products only.
Their Trading Area is much Larger that the retailers Trading
Area.
Their Margin are Lower but Made up with much Higher
Volumes.

10. Functions of Wholesalers
Sales and Promotion Function for Chosen
Companies Products.
Buying the Assortment of Goods to be Handled
Storage and protection of Goods till they are
sold.
Sometimes Grading and Packing of Goods.

11. Contd….
Transportation of goods to the customers.
Financing the buying of Goods and extension of
Credit to the Customers.
Bearing the Risk Associated with the Business.
Collecting and Disseminating market
information to the suppliers and customers.

12. Wholesaling functions for Producer & Supplier
Order Collecting & Marketing Agency for Producer.
Collects orders from large number of Retailers and
Distributes goods which is uneconomical for Producer
himself to do.
Wholesaler place the Orders in Advance.

13. Contd….
This ensures the great deal of certainty of
sales to the Producer.
The manufacturer can thus focus on the
quality and quantity.
Source of Information to the Producer since
he is in touch with the Market.

14. To Summarize the Functions of Wholesalers
Selling Function
Stocking Function
Financing Function
Information
Risk Handling.

15. Wholesaling Functions for Retailers
Wholesalers tries to Resolve the Finance & Stocking
problem of the Retailer.
He manages his own Inventory well thereby reducing
the risks of Carrying the Extra Stock.
Wholesalers deliver the goods promptly – There is no
waiting period.
Wholesalers delivers the best value for the goods
handled by him.

16. Contd….
The Retailer gets the Information about the new
products, Promotions .
Call frequency of the Retailer to Retailer will
vary.
The Wholesalers will normally sells to its
important customers on credit.

17. Classification of Wholesalers
Full Service wholesalers: Stocking, Selling,
Offering Credit, Delivery of Goods, and any
business assistance all are provided by the
Wholesalers.
Limited Service Wholesalers: The name Indicates
the Range of Services are limited.
Examples : Cash and Carry(Metro Type).
Merchant Wholesalers: Independent Business
which includes Distributors, Executives etc..

18. Contd…
General Merchandise: Stock a wide assortment of
unrelated products lines – Drugs, Hardware, Electric
Suppliers, Auto Equipments, food, Detergents,
Cosmetics.
General Line: Carry One or Two products line but in
depth examples Grocery, Drugs.
Producer Co-operatives: Most common in
Agricultural Products Ex: APMC yards these are set
up by the farmers to buy and sell in large quantities.

19. Wholesalers – Key Task
Assembling or Aggregating Goods
Warehousing of the Goods
Order Booking and Execution
Transportation of the Goods
Financing of the Goods
Risk Bearing
Grading and Packing
Providing Market Information

20. Major Wholesaling Decision
Man Power
Which Product to Sell
Promotional Support
Credit and Collections
Image and Customer Perception
Warehouse Location and Design
Inventory Control
Which Market to Operate in?

21. Strategic Issues in Wholesaling
Target Market Decisions
Number of Customers,
Demographic factors of Customers
Marketing Mix Decisions
Product
Place
Price
Promotion

22. Trends Shaping Wholesaling
Functional Flexibilities
Increased services
Pricing & credit
Regional coverage
Organizational form & size

23. Contd…
If the Company has good delivery system
across various markets it can eliminate
wholesalers.
Modernizing their warehouse and physical
handling facilities.
Profit margin are getting low between 1%-2%

24. Impact of Technology in wholesaling
E-commerce and use of internet throws up
challenge for wholesalers
Wholesalers are becoming more service
oriented by using technology to face the
competition
Information in internet are putting more
pressure on wholesalers whose primary role is
providing information to bring buyers and sellers
together.

25. Challenges in Wholesaling
Inventory Management
Should maintain a certain level of Goods always
Wholesaler should constantly monitor this Inventory
and should not let it go down.
Best Handling of the stocked Goods.
Most of the Damaged goods are cost to the Company.
For damaged goods he will claim the Reimbursement
from the company.

26. Sales Management
Wholesaler has to make the sales to his customers
without the direct involvement of the company sales
personnel.
He has keep on opening an new account Regularly.
Better servicing of the Existing customers will help in
renewal.
wholesalers sales men has to keep an eye on the
competition activity.
Concentrating on CRM will increase the Market share.

27. Promotion Management
Passing on the Company discounts to customers.
Introducing the products by giving free samples.
Display Schemes
Brand Sign Boards
Contests on a particular brand of products
Insertion activities.

28. Financial Planning and management
Security Deposit Before appointing the intermediary
Security deposit to protect the company from any payment
defaults by the Distributor.
A distributor is required to keep 10 pre signed Cheques with the
Company.
If any of the Cheques gets Bounced then the distributor has to
make the Payment through Demand Draft only for next three
months.
Due to intense competition in the Market the distributor has to
extend credit facility to his customers.
The Average Credit period provided by the wholesalers to his
retailers is 15 days.

29. Retailing

30. Retailing and its Importance
According to English Dictionary the word RETAIL
is derived from the French term Retailler which
means “ TO BREAK BULK”
For Example:- The Retailer Buys the whole Case
of Beer Bottles , buys the whole box of Britannia
Biscuits but sells in 100 grams and beer bottles
in half liter and one liter cans.

31. Meaning of Retailing
Retailing includes all activities involved in
selling of products and services to ultimate
consumer for their Personal or Home
consumption.
Ultimate consumers make most of their
purchases in the Retail Stores.

32. Characteristics of Retail Trade
Retailers are considered to be the last link in
the Distribution Channel
Retailers has more knowledge about the
customers aspirations and requirement.
Retailers can Influence on the Buying decision
of the Consumer.
The order Size in Retail is tend to be small but
many.
The Retailers Caters to wide variety of
Customers.

33. Contd….
Retail Store service and goods displayed in store
are more important element of selling process.
The Strengths are in ensuring the Availability
and visibility of the Product he sells.

34. How do Consumer Decide which Retailer to Buy
Price( Value Offered, Credit and Discounts)
Place( Convenience, Parking, safety, Nearby)
Product Selection( Width and Depth of the
Product assortment)
Special Services( Home Delivery, Gift Wrap, Free
Parking)
Helpful sales People( Fast check out, Knowledge)
Fairness in Dealing( Honesty, Return Privileges)

35. Types of Retailer
Specialty Store
Narrow product line with deep assortment.
Example: Furniture stores, Book shops, Apparel,
Mega Mart
Department Store
Several product lines in different departments
Example: Shoppers stop

36. Contd….
Super Market
Large, Low cost, Low Margin, High Volume and self
service operation with a wide offering
Smart, D-Mart etc…
Convenience Store
Small stores located in Residential areas, Open
Long hours all days of the week limited variety of
products like groceries and food products.

37. Retailing and its Importance to Consumers
Merchandising:-
A set of Activities involved in acquiring goods and
services and making them available at the places.
The focus is on acquiring the goods and storing
them so that any consumer can access to them at
a time , place and quantity convenient to them.
Merchandising Functions:-
Availability of Products at the store so that no
costumer go back without buying his requirement.
Making the product available in different
Assortment.

38. Contd…
Taking the right decision to introduce the right
product to the customers.
Getting the products at the right prices and
taking the advantage of all promotional activities.
Planning out for shelf and space for the products
to display.

39. Customer Service
The Location of the store and its working hours.
The width and depth of the goods available in
the store.
The prices at which the goods are made
available.
Help and assist within the store to support the
selection of the goods by the consumers.
Free demonstration of the product if required.
Additional facilities like A.C., Coffee shop, Card
access facility etc..

40. Customer communication
Communication basically used by the Retailer is
about:
Announce the Opening of the Retail store.
Tell customers about the promotions Running.
Inform customers about the any additional
facilities introduced in the store.
Example:- We keep on seeing full page
advertisements almost every Sunday from big
bazaar about the promotions the store is running
currently.

41. Employment Opportunities in Retail
The retail industry offers substantial
employment opportunities.
Part-time and Full time work is plentiful ranging
from small, independent retailers to national and
multinational retail chains.
Solid store experience can lead to an array of
retail management and store support career
ladders.

42. FDI to boost employment opportunities in retail
Rituparna Chakraborty, Vice- President, Indian Staffing Federation
shared a few facts with TJinsite (research & knowledge arm of
TimesJobs.com), "It is estimated that FDI in retail can create
approximately 4 million direct jobs and almost 5 to 6 million
indirect jobs including contractual employment within a span of 10
years, making it the largest sector in organized employment."
Waving off the uncertainty in the market, experts predict that the
declaration of FDI in retail will benefit the entire Indian retail
sector. Job opportunities across levels and profiles are expected to
grow and demand for niche skills will be high. As Seema Arora
Nambiar, Senior Director, People Resources, McDonald's India
(West & South Region) stated in TimesJobs.com RecruiteX, "With
the opening up of the Indian market to single-brand FDI
employment opportunities, especially, at the entry level, will rise."
Profiles such as sales, supply chain executives, security personnel,
attendants, in-shop supervisors, floor managers and warehouse
supervisors are likely to see significant increase in demand, added
Rituparna.

43. THANK YOU