Introduction
Both wholesaler and retailer are the members of distribution channel. Wholesaler refers to the business entity that buys goods in bulk from producers or distributors and sells to other businesses such retailers. On the other hand retailer purchases goods from wholesalers (sometimes from producers also) and sell them to the final consumers.
Wholesaler Vs Retailer: Key Differences Explained
The main dissimilarities or differences between wholesaler and retailer can be highlighted as follows:
1. Volume of transaction
Wholesalers purchase and sell goods in large quantity. But retailers purchase goods in large quantity and sell in small quantity to actual consumers.
2. Purchase and sale
Wholesalers purchase goods from producers and sell to retailers. Retailers purchase goods from wholesalers or sometimes from producers and sell them to final consumers. The goods sold by retailers are not re-sold.
The main dissimilarities or differences between wholesaler and retailer can be highlighted as follows:
1. Volume of transaction
Wholesalers purchase and sell goods in large quantity. But retailers purchase goods in large quantity and sell in small quantity to actual consumers.
2. Purchase and sale
Wholesalers purchase goods from producers and sell to retailers. Retailers purchase goods from wholesalers or sometimes from producers and sell them to final consumers. The goods sold by retailers are not re-sold.
3. Specialization
Generally, wholesalers deal in special products. But retailers deal in different goods of different nature, types and quality.
4. Scope
Scope of wholesaling is wide, it remains expended in different cities and villages. Scope of retailing is limited, it remains in local area.
5. Knowledge of salesmanship
Wholesalers needs financial capacity, but need not to be knowledgeable and salesmanship in selling goods. A retailer needs to be an effective seller, should be knowledgeable in selling
activities.
Generally, wholesalers deal in special products. But retailers deal in different goods of different nature, types and quality.
4. Scope
Scope of wholesaling is wide, it remains expended in different cities and villages. Scope of retailing is limited, it remains in local area.
5. Knowledge of salesmanship
Wholesalers needs financial capacity, but need not to be knowledgeable and salesmanship in selling goods. A retailer needs to be an effective seller, should be knowledgeable in selling
activities.
Also Read:
Meaning And Features Of Retailing
6. Nature of selling
Wholesalers sell goods to retailers, generally, on credit, and retailer makes payment after selling goods to final consumers. Retailer sells goods to final consumers on hand cash, even if sold on credit, it is only for shorter time.
6. Nature of selling
Wholesalers sell goods to retailers, generally, on credit, and retailer makes payment after selling goods to final consumers. Retailer sells goods to final consumers on hand cash, even if sold on credit, it is only for shorter time.
7. Importance of place
For wholesaling, place is not so important, it also does not need to display of goods or decoration of shop to attract customers. But for retailing location of shop is very important, a retailer should be clever, consider and pay much attention to display and decorate shop to attract customers.
8. Storage / Inventory
Wholesalers require more space or warehouse to store large quantity of products. On the contrary retailers do not require large space because of smaller inventories.
9. Investment
As we know that wholesalers buy goods from manufacturers in bulk so they require huge investment than retailers.
Comparison Table
|
Aspect |
Wholesaler |
Retailer |
|
Transaction Type |
B2B |
B2C |
|
Transaction Volume |
Large |
Small |
|
Profit Margin |
Less |
High |
|
Investment |
High |
Less |
|
After sales Service |
No |
Yes |
|
Marketing Cost |
High |
Low |
|
Storage Needed |
large |
Small |
|
Product Range |
Fewer |
More |
Distinction Between Wholesaling And Retailing In Short
* Wholesaling means purchasing large quantity of goods from manufacturers or distributors and selling to other small business. On the other side retailing is to buy goods from wholesalers and buying to ultimate customers.
* Wholesaling requires large capital than retailing
* Retailers enjoy more profit margin than wholesalers
* Wholesalers deal with fewer variety of product line but retailers sales wide range of products
* Wholesalers require large warehouses to store large quantity of goods but retailers do not require large space
* Wholesaling does not require specific knowledge and salesmanship but retailers required these knowledge because they required to deal with the final customers.
