These are various activities that involve buying goods in large quantities from different manufacturers and sell them to retailers in small quantities.
The wholesaler is the middlemen between the producers and retailers as shown under:
Producer Wholesaler Retailer Consumer
The wholesaler can also be found between the manufacturer and the consumer:
Manufacturer Wholesaler Consumer.
Functions of wholesalers
Wholesalers perform important functions to retailers, manufacturers and customers.
Functions of wholesalers to producers
Brands , bottles ,blends ,grades ,packages and bleaches products
It gathers orders from various retailers
It keeps finished products
It removes products from producer's factories to create space for more production
It shoulders the risks
It promotes products for producers
It acts as a market for producers
It pays cash to producers
It gathers information from the market on consumer needs and wants.
Functions of wholesalers to retailers
It helps retailers with display methods and laying out of the store
It bottles ,blends ,grades , packages and delivers products to retailers
It gives trade credit to retailers
It smoothens out the availability of products especially seasonal goods
It avails storage facilities to retailers
It conveys complaints from retailers to manufacturers
It introduces new goods to retailers
It breaks the bulk for retailers
It provides retailers with a wide range of products sourced from many and different producers.
Functions of wholesalers to producers
Taking end —users' complaints to producers
Introducing new products to end —users
Making consumers aware of new products through advertising
Providing a wide variety of products
Preventing too much up and down swings of prices
Ensuring an uninterrupted supply of goods.
Types of wholesalers
There are many and different types of wholesalers, they include the following:
Cash and carry wholesalers
These are wholesalers that sell their products on cash and carry basis.
Features
Sell products with high rate of turn-over
They provide trolleys and shopping baskets
They sell a wide range of products
They have parcel counters where customers leave their bags
Their goods are lowly priced
They have security measures for examples cameras
They employ self —service method
They sell to both retailers and customers in bulk
They have check —out points
They display their wares attractively.
Specialist wholesalers
These are wholesalers that concentrate on a single type of a product for example the sale of electrical products only.
Features
They are very good in selling one type of the product
They give knowledgeable advice on the use and care for the product
General wholesalers.
These wholesalers supply much different merchandise.
Features
Their prices do not fluctuate much
They have many sales personnel
They provide delivery services
They give trade credit to retailers
They finance producers by paying cash
They provide storage facilities
They supply a variety of products
They advise and inform retailers on products
They carry risks through warehousing products
Co-operative wholesale societies.
These are formed by producers for example farmers or co-operative retail societies.
Features
They provide a wide range of products
They usually sell products with very short shelf —life for example fruits or vegetables
They purchase from producers directly
They can produce their own products
They purchase from farmers at very low prices
They sell their products in large quantities and at very low prices
They may sell to co-operative members
Each co-operative members contribute some money
The extras made are shared among co-operative members
Trends in wholesale trade.
These are developments taking place in wholesale trade.
Elimination of wholesalers
This refers to the removal of the wholesaler from or by-passing of wholesalers in the chain of distribution.
There are many forces leading to the removal of wholesalers from the chain of distribution
Despite the forces to eliminate wholesalers from the chain of distribution, wholesalers still exist today.
Reasons for the removal of wholesalers.
The introduction of tied shops for example Total Filling Stations
Some products are fragile and need special handling for example glasses
There are products that require fast distribution for examples perishables like vegetables
The opening up of own retail shops by producers for example Bata Shoe Company
Some products have slow rate of sale for example expensive vehicles and these require direct selling
The appointment of official distributors who sell directly to retailers
The development of large scale retailers with huge financial resources ,own storage facilities and transport to buy in bulk direct from producers
Buying from manufacturers is cost —effective.
Reasons for the continued existence of wholesalers.
Despite all these forces to eliminate wholesalers, they are still around for the following reasons:
Some retailers do not have adequate financial resources to buy directly from producers
Some retailers do not own any transport.
Some retailers do not have adequate storage facilities
Some products still require re-branding, packaging, blending and grading before they are sold.
Role of intermediaries or agents.
The intermediaries that we have include:
Brokers
Factors
Del credere agents
Forwarding agents.
Marketing boards
Marketing Boards are statutory institutions or public corporations or state enterprises or parastatals established by an Act of parliament to handle the marketing of agricultural or industrial products. Examples of marketing boards include:
The Grain Marketing Board[GMB]
The Minerals Marketing Corporation[MMC]
The Cold Storage Company of Zimbabwe[CSCZ]
The Tobacco Marketing Board[TMB]
The Cotton Company of Zimbabwe[CCZ]
The Dairy Board Company of Zimbabwe Limited [DBCZ].
Reasons for the formation of Marketing Boards.
Preventing shortages
Stabilizing prices
Providing storage facilities
Advising farmers on seed and equipment
Provision of markets for produce
Maintaining the quality of products
Collecting products from producers
Products processing
Preventing fluctuations in supply of products
Encouraging exportation and importation of such products
Carrying out research and development of agricultural products.
Grain Marketing Board Silos
The Grain Marketing Board is the only buyer of all grains in Zimbabwe for example maize, wheat, sorghum, soya beans, rapoko and many more.
Functions of GMB
Buying grain from farmers
Storing grain
Selling grain to importers, millers and consumers
Preventing shortage of grain
Monitoring prices of grain
Delivering grain to consumers
Providing inputs to farmers
Preserving and processing grain
Grading grain.
Cold Storage Company
It deals with monitoring the quality of meat in all abattoirs to ensure hygienic standards.
Functions of CSC.
Supplying meat to registered butcheries. Exporting beef
Buying and slaughtering cattle. Operating own cattle ranches
Helping producers willing to keep cattle.
Minerals Marketing Corporation Zimbabwe
It is the only buyer of all minerals except gold and silver.
Functions of MMCZ
Permitting the sale of minerals between sellers and buyers
Provision of advice and expertise
Selling metals, asbestos, ores and gem stones to export markets.
Cotton Company of Zimbabwe
It deals with helping and advising cotton farmers.
Functions of CCZ.
Giving seeds to cotton growers
Running ginneries. Selling lint locally and abroad
Supplying cotton seeds to oil manufacturers.
Tobacco Marketing Board
It focuses on tobacco, tobacco products and tobacco processing.
Functions of CCZ.
Financing tobacco growers.
Warehousing tobacco
Monitoring tobacco prices
Preventing shortages of tobacco
Selling tobacco products locally and abroad
Collecting and buying tobacco from tobacco growers
Inspecting and grading tobacco.
Dairy Board Zimbabwe Limited
It deals with milk, milk products and milk processing.
Functions of DBZL.
Providing finance for research on milk and milk production
