“Wholesale trade is unnecessary between the producer and the consumer.” Discuss.


Ans-Wholesaler is a trader who buys goods in large quantities from the producers and sells them to the retailers in small quantities according to their requirement. So that more and more people of the society can get the opportunity to consume different things. Both the removal and non-removal of mediators are heard. In the intermediaries, this includes brokers, arhtiyas, banks, other service institutions, collectors etc. and also includes wholesalers. In the minds of many people, intermediary is synonymous with wholesale trade. Therefore, here we would like to clarify that even after removing the wholesaler in the middlemen, distribution work can be done, but it is not possible to remove all types of intermediaries. This is the reason that whenever there is a discussion of intermediaries, the wholesaler becomes the subject of discussion.

Reasons for Eliminating Middlemen or Wholesalers

In the modern era, the nature of removing the middleman wholesaler from the link of the distribution channel is found in all the developing countries. For this, many allegations are made by critics in relation to the seller of the yoke, the main ones are as follows.

(1) Unnecesary Increase in the Price of a Product – Wholesalers make unnecessary increase in the price of the commodity, because a commodity passes through the hands of different wholesalers and each wholesaler pays commission on them. or take advantage. Therefore, it is natural for the price of the commodity to increase because of this. Thus, unnecessary burden of profit of wholesale traders falls on the consumers.

(2) Failure to Perform Storage Functions – Modern transport means have made it accessible for the wholesaler to reduce the quantity of goods as per their requirement. This increases the pressure on the manufacturer to keep enough stock to meet all orders and also bear the risk of price fluctuations. Earlier this task of keeping the stock was done by the wholesaler and he also had to bear the risk of price fluctuations. Thus, the first reason for removing the wholesaler is the failure of the wholesaler to perform the store work.

(3) Wide Use of Brands and Advertisements – Some critics say that over the years manufacturers have started using more trademarks and they need to rely on wholesalers to sell their goods through advertising. There is no need as the retailers can directly mobilize the goods from the producers.

(4) Failure in Promoting Products – Promotional actions are not resorted to by the wholesaler to sell more quantity of the goods of the manufacturer. They neither advertise nor run special discount or credit schemes, nor do they assist with advertising and other promotion schemes in collaboration with retailers.

(5) Closer Market Contact – Those goods and services in which direct and close relationship of seller and seller is necessary, intermediaries are also removed in them such as repairing institutions, service providers and Organizations that install machines and other types of goods. All these services can be well provided by the retailer.

(6) Cost of Wholesaler Services – One of the reasons for removing wholesalers is to increase the price of the item by them. Wholesalers add cost of goods and some profit to the prices of the goods, while those same services are provided less by the manufacturer.

(7) Direct Sale by Manufacturers – In time the manufacturers themselves have started opening retail shops to sell their goods; Like- Delhi Cloy Mills, Elgin Mills, Bata Company, Carona Shoe Company, Usha Engineering Company etc.

(8) Use of Private Trade Marks – Wholesalers destroy the reputation of the producers on the one hand by putting their personal trade marks on the goods of the producer and on the other hand exploit the consumers by getting monopoly on distribution. .

(9) Psychology to Earn More and More Profits – Wholesalers take more interest in the goods of those producers who give them more commission irrespective of the type of their goods. Therefore, the corrupt attitude of the wholesale traders to make huge profits is neither beneficial for the producers nor for the consumer.

(10) To encourage black marketing – There is a lot of truth in the opinion of the critics that theft is the gift of wholesale traders. They create artificial shortage in the market by hiding the goods and keep selling the goods by increasing the prices. This hurts the reputation of the producers and exploits the consumers.

On the basis of the inherent defects in wholesale trade and the development of modern means of distribution, it can be said that the wholesalers exploit the consumers by unnecessarily increasing the prices of the goods and reduce the profit margin of the producers. For this reason modern marketers have made the use of yoke traders unnecessary. Therefore, it appears that the wholesaler has made the use of parasrayer unnecessary. For this reason modern marketers have made the use of wholesalers unnecessary. Therefore, it appears that wholesalers are paralyzed, they should be removed from the distribution chain. But where they have their faults, on the other hand they also provide many services to the manufacturers, retailers and consumers. In the absence of these marketing work is not impossible but it will definitely become difficult. Therefore, removal of wholesalers is neither desirable nor profitable. Yes it is possible that their use should be reduced.

J. F. Payle in his book ‘Marketing Principles’ expressed the following view, “Wholesaler is being tested whether he still has a place in our marketing system? So far he can do or does marketing services in a more satisfactory position than other institutions, he will continue to get an advantageous position, so long as the producer considers the marketing institutions profitable to focus his main attention on production and sale of goods. “We should expect to keep the services of intermediaries alive as long as the consumer finds it more convenient to meet his needs with the retailer rather than overdoing the production and handing over.”


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