There is no shortage of products these days. Consumers have more choices than ever before across most industries. To assist brands and manufacturers understand the differences better we have written this article. We will try to clear up the difference between retailing products and wholesale.
Products that can be bought from your favorite store are purchased retail. How the product got there can involve a variety of ways and processes. Getting products into the hands of consumers requires effective marketing and advertising campaigns to support the sales process. The sales process can be complex and can take time.
Here are some differences that are important to understand by individuals and organizations selling products.
What are Distributors?
Distributors are companies that buy products from manufacturers (brands), store them, and make them available to their clients, the retail stores. These distributors can be local, regional, state, or even national covering the entire United States. Distributors are the single point of contact for many brick and mortar retailers that buy products from them and stock their shelves. Manufacturers that wish to sell their product in these stores have to secure agreements with the relevant distributor.
When selling products through distributors and indirectly or directly to retailers, it is considered wholesale. The individual products are sold at wholesale prices to enable distributors and retailers to markup the products to the suggested retail price and create profits for them as well.
What are Retailers?
Retailers are the brick and mortar and now even online only companies that sell products directly to the consumers. For retailers to profit, they search for products that sell well, are properly supported by brands, and have the right price points. Larger retailers tend to purchase from distributors, while smaller retailers may buy directly from manufacturers (brands).
Retailers generally purchase enough products from manufacturers or distributors to stock their shelves and fulfill their orders. They reorder if the product sells well. Often, retailers test products in a few stores prior to making larger purchases and offering the products across all locations.
Retailing products refers to selling products directly to consumers. Many brands and manufacturers sell products via retail directly to consumers. This is often the case with industries such as cosmetics or skin care. These products are offered for sale on the brand’s website via e-commerce. Also, the products may be available in certain stores. When the brand sells the product directly to the consumer, it is retailing. When the consumer makes the purchase in a store, the brand sold that product via wholesale through the retailer.
Companies that wish to gain a better understanding of how to increase sales for products can always work with consultants. Consulting services are a great way to gain a better understanding prior to allocating budgets or deciding upon a strategy.
