Specialty-line wholesalers deal in very few products but with high specialization in their chosen product line(s), such as only dealing in pharmaceuticals.

Full-service wholesalers provide widest range of services, such as quantity breakdowns, financial assistance and credit, marketing services and product availability. Full-service wholesalers usually earn a higher profit margin than other wholesalers, but operating expenses are much higher as well.

Limited service wholesalers specialize in fewer functions than Full-service wholesalers, generally allowing producer or customer to provide most functions. These wholesalers include Cash-and-carry companies, Trucking companies, Drop-shippers or Mail-order firms. Limited service wholesalers take title to products but usually do not provide many of services a Full-service wholesaler does, like marketing, retailer site selection or personnel training. Due to limited nature of their services, they have lower operating costs but are also limited to lower profit margins as well.

Wholesalers, in order to keep their operating expenses down, often deal only with companies or with clients able to meet minimum orders, whether monetary or by item count. This can make things difficult on a small business or sole proprietorship looking to reduce cost-of-goods-sold. However, there are many wholesalers or wholesaler-like companies that cater to smaller-volume customers. This is where companies like Costco or Wal-mart's Sam's Club come in--as Costco and Sam's Club are not technically wholesalers, but direct-retailers with lower operating costs, buying in smaller bulk volumes from a company that uses this business plan is often a viable compromise between lower rates but logistical issues of a standard wholesaler, and lower profit margins of buying from a retailer, and may make all difference to a small company operating on a shoestring.

© 2005, Wholesale Pages UK. All rights reserved.

About the Author

Industrial Connection is only Manufacturing dedicated publication covering Southeastern United States, with emphasis in Florida, Georgia, North and South Carolina. Cutler added that, “We are going to generate a series of articles about quality, and manufacturing process improvement from Six Sigma to Lean Manufacturing Certification, Electronic Kanban to Job Scheduling.

Circulation of publication is 15,000 and distribution is free of charge. Cutler writes for hundreds of other publications each year (www.trcutlerinc.com) and will consider further profiles of manufacturer’s representatives based on participation in Industrial Connection program. Cutler also serves as spokesperson for ETO (Engineer-to-Order) Institute (www.etoinstitute.org).

TR Cutler Associate Editor Industrial Connection e-mail protected from spam bots 888-902-0300

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