June 6, 2014

Managing Wholesaling and Retailing Network

Marketing Management Revision Article Series


Wholesaling includes all the activities involved in selling goods or services to those who buy for resale or business use. Wholesaling excludes manufacturers and farmers because they are engaged primarily in production. (Kotler)

Why wholesalers are used?

Wholesalers buy in large cart loads and break the bulk into smaller units and distribute these small quantities to large number of retailers efficiently.

Wholesalers are used when they are more effective or efficient in performing one or more of the following functions:

Selling and promoting
Assortment building
Bulk breaking
Risk bearing
Market information gathering
Management services and counseling to retailers

In the recent days, there is criticism that wholesalers are not adding adequate value. Savvy wholesalers responded by by efforts to increase asset productivity by managing inventories and receivables better.  They also undertook studies and projects to reduce operating costs by investing in more advanced materials-handling technology, information systems, and the Internet. There are also improving their strategic marketing decisions about target markets, product assortment and services, price, communications and distribution.

Wholesale Distribution Channles - Bert Rosenbloom, 1993, Professor of Marketing Management with specialisation in distribution channels.

How to Start a Whole Sale Distribution Business?


Retailing includes all the activities involved in selling goods or services directly to final consumers for their personal, nonbusiness use. A retailer or retail stores is any business enterprise whose sales volume comes primarily from retailing.

Types of Retailers

Specialty store
Department store
Convenience store
Discount store
Off-price retailer
Catalog showroom

Levels of Service in Retail Shops

1. Self-service
2. Self-selection
3. Limited service
4. Full service

Nonstore retailing

1. Direct selling
2. Direct marketing - catalogue marketing
3. Automatic vending
4. Buying service

New Retail Environment - Trends

New Retail Forms and Combinations
Growth of Intertype competition
Competition between store based and nonstore selling
Growth of giant retailers
Decline of middle market retailers
Growing investment in technology

Marketing Decisions of Retailers

Target market
Product assortment
Store atmosphere
Store activities and experiences
Location decision
Private labels


Articles about Retail and Wholesale by Harvard Business School


Updates 6 June 2014, 3 Dec 2011