Wholesaling or distributing is the sale of goods or

merchandise Merchandising is any practice which contributes to the sale of products to a retail consumer. At a retail in-store level, merchandising refers to displaying products that are for sale in a creative way that entices customers to purchase more i ...

to retailers; to

industrial Industrial may refer to: Industry * Industrial archaeology, the study of the history of the industry * Industrial engineering, engineering dealing with the optimization of complex industrial processes or systems * Industrial city, a city dominate ...

, commercial, institutional or other professional business users; or to other wholesalers (wholesale businesses) and related subordinated services. In general, it is the sale of goods in bulk to anyone, either a person or an organization, other than the end consumer of that merchandise. Wholesaling is buying goods in bulk quantity, usually directly from the manufacture or source, at a discounted rate. The retailer then sells the goods to the end consumer at a higher price making a profit. According to the United Nations Statistics Division, ''wholesale'' is the resale of new and used goods to retailers, to industrial, commercial, institutional or professional users, or to other wholesalers, or involves acting as an

agent Agent may refer to: Espionage, investigation, and law *, spies or intelligence officers * Law of agency, laws involving a person authorized to act on behalf of another ** Agent of record, a person with a contractual agreement with an insuranc ...

or broker in buying merchandise for, or selling merchandise to, such persons or companies. Wholesalers frequently physically assemble, sort, and grade goods in large lots, break-bulk, repack, and redistribute in smaller lots. While wholesalers of most products usually operate from independent premises, wholesale marketing for foodstuffs can take place at specific wholesale markets where all traders are congregated. Traditionally, wholesalers were closer to the markets they supplied than the source from which they got the products. However, with the advent of the internet and

e-procurement E-procurement (electronic procurement, sometimes also known as supplier exchange) is the business-to-business or business-to-consumer or business-to-government purchase and sale of supplies, work, and services through the Internet as well as oth ...

there is an increasing number of wholesalers located nearer to the manufacturers in China, Taiwan, and Southeast Asia. The profit margins of wholesalers depend largely on their ability to achieve market competitive transaction costs. In the banking industry "wholesale" usually refers to wholesale banking, providing tailored services to large customers, in contrast with

retail banking Retail banking, also known as consumer banking or personal banking, is the provision of services by a bank to the general public, rather than to companies, corporations or other banks, which are often described as wholesale banking. Banking servi ...

, providing standardized services to large numbers of smaller customers. In real estate, wholesaling is the act of contracting to purchase real property, and assigning that contract to an investor.

Taxes

Often, in the United States, wholesalers are not required to charge their buyers

sales tax A sales tax is a tax paid to a governing body for the sales of certain goods and services. Usually laws allow the seller to collect funds for the tax from the consumer at the point of purchase. When a tax on goods or services is paid to a govern ...

, if the buyer has a resale license in the state the wholesaler is located. Out-of-state buyers are not charged sale tax by wholesalers.

Direct selling

The alternative to selling wholesale to distributors or retailers is to sell retail either through company-owned stores or online. Advantages include receiving a larger slice of the price paid by the consumer; disadvantages include difficulty in reaching consumers. Direct selling is a business model wherein sellers sell the goods directly to the end customer.

References

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Taxes

Direct selling

See also

References