What is a wholesaler?

A wholesaler is defined as a firm that resells goods to retailers. This role is crucial in the supply chain, as wholesalers purchase large quantities of products from manufacturers and then sell them in smaller quantities to retail businesses. This process allows retailers to stock a variety of products without having to deal directly with multiple manufacturers, thus simplifying their inventory management.

Wholesalers typically provide several advantages, including bulk purchasing to achieve lower prices per unit, storage of products, and the ability to offer a diverse range of goods from various manufacturers. This makes it easier for retailers to find the products they need without dealing with each producer individually.

Other options, such as a company that manufactures products, a retailer selling directly to consumers, or an intermediary for raw materials, do not accurately define a wholesaler. Manufacturers primarily produce goods, retailers focus on selling directly to the end consumer, and intermediaries for raw materials typically deal with the supply of primary materials rather than finished goods for resale.