1. Principles of Business, Marketing, and Finance Lesson Eleven Wholesalers in a Private Enterprise System UNT in partnership with TEA, Copyright ©. All rights reserved

2. Manage the Middle Producers use wholesalers to reach all of the consumers in its target market Numerous retailers Easier for a retailer to work with a wholesaler than numerous producers UNT in partnership with TEA, Copyright ©. All rights reserved 2

3. Benefits of Wholesalers Provide important marketing services for the channels in which they participate Provide one or more of the needed marketing activities better or at a lower cost Combine the orders of several small retailers and purchases in efficient quantities Specialize in storage and inventory management Provide facilities for product storage that manufacturers do not have UNT in partnership with TEA, Copyright ©. All rights reserved 3

4. BuyingSellingTransportingStoringFinancing Wholesaling Activities UNT in partnership with TEA, Copyright ©. All rights reserved 4

5. Wholesaling Activities Accumulate products of many manufacturers, develop appropriate assortments for customers, and distribute the products to their customers Assist manufacturers in determining needs of retailers and final consumers and provide market information to retailers Collect and analyze information on sales, costs, changes in demand, and inventory levels Purchase products from producers and manufacturers and selling them to their customers Assume risk by investing money in products that may be damaged or destroyed UNT in partnership with TEA, Copyright ©. All rights reserved 5

6. Full-Service Wholesalers Take title to the products they sell Provide a full range of distribution activities Provide or arrange transportation services UNT in partnership with TEA, Copyright ©. All rights reserved 6 Offer Credit Provide promotion assistance, product research, information, product installation and repair

7. Limited-Service Wholesalers May not provide services such as research, credit, or promotional support Concentrate on one or two important functions such as warehousing and storage, product delivery, or accumulating products for sale in a convenient location UNT in partnership with TEA, Copyright ©. All rights reserved 7

8. Locating Suppliers Selling Financing Extension of Workforce Arranging Shipment Do Not Take Title to Products Independent businesses Provide specialized exchange functions Agents and Brokers UNT in partnership with TEA, Copyright ©. All rights reserved 8

9. Other Wholesaling Businesses of small businesses that affiliate because of the benefit gained from cooperating for marketing and distribution activitiesWholesale franchises and cooperatives - groups of small businesses that affiliate because of the benefit gained from cooperating for marketing and distribution activities IGA FTD ACE Hardware UNT in partnership with TEA, Copyright ©. All rights reserved 9

10. Wholesale Member Clubs Sam’s and Costco Open to final consumers and businesses Products displayed in large warehouses UNT in partnership with TEA, Copyright ©. All rights reserved 10 Limited product assortments are available in large quantities Customers must transport their purchased products

11. Changing Role of Wholesalers Large retailer may prefer working directly with producers (such as a particular designer) There are more small- and medium-sized retailer and manufacturers than there are large businesses UNT in partnership with TEA, Copyright ©. All rights reserved 11

12. Access to markets Product awareness Export and import organization -important in building international business Better communications and information -improved technology, broader customer service Work to identify their customers -understand their needs Learn the problems the customers are having -with products and marketing activities and help them to solve those problems UNT in partnership with TEA, Copyright ©. All rights reserved 12 Changing Role of Wholesalers

13. Specialized Services Marketing Research and Marketing Information Services Provide Customers with Important Data Computer Technology to Process Orders Quickly New Methods for Storing and Handling Products to Reduce Product Damage, Cost of Distribution, and Time Needed for Delivery UNT in partnership with TEA, Copyright ©. All rights reserved 13 RFID applications in “smart mirrors” used in fitting rooms in department stores. RFID tags enable interrogation of database to find complementary items or locate other sizes or colors.

14. Adding Customer Service Marketing and Promotional Planning 24-Hour Ordering and Emergency Deliveries Specialized Storage Facilities Individualized Branding and Packaging Services UNT in partnership with TEA, Copyright ©. All rights reserved 14