Wholesaling

Service Level

Wholesalers can be distinguished by the number and depth of services they provide to their customers. 

• Full-Service – Wholesalers in this category mainly sell to the retail industry, and in most cases, require a strong, long-term retailer-wholesaler relationship be established.  In addition to basic distribution services, such as providing access to an assortment of products and furnishing delivery, these wholesalers also offer customers additional services that aid retail store operations including offering assistance with: in-store merchandising; retail site location decisions (e.g., find best geographic location for a new store); store design and construction; back-end operations (e.g., payroll services); financial support; and many more.
• Limited Service – Compared to full-service wholesalers, buyers dealing with limited service firms offer far fewer services.  Most offer basic services, such as shipping and allow credit purchasing, but few offer the number of service options found with full-service wholesalers.
• No Service – Some wholesalers follow a business model whose only service is to make products available for sale and only on a cash basis.  In these instances, the buyer handles their own transportation of the product.

Product Ownership

Wholesalers can be classified based on whether they do or do not become the owners of the products they sell.  By ownership we mean that title (i.e., legal ownership) has passed from the party from whom the wholesaler purchased the product (e.g., manufacturer) to the wholesaler.  It also means the wholesaler assumes any risk that may arise with handling the product.

• Do Take Title – Wholesalers taking title own the products they purchase.
• Do Not Take Title – Wholesalers who do not take title are focused on activities that bring buyers and sellers together.  Often these wholesalers never physically handle products.