Chapter 10: Wholesaling and Product Movement

Chapter Summary:

In this chapter, we first examine another reselling group – wholesalers – and see how they come into play when a marketer attempts to reach the final customer.  We show wholesalers exist in many formats, affect a wide range of industries, and offer different sets of features and benefits depending on the markets they serve.  In the second half of the chapter, we examine the tasks that must be carried out in order to physically move products to customers.  In some cases, the marketer will take on the responsibility of carrying out some functions, while other tasks may be assigned to distribution service providers.  Whether handled by the marketer or contracted to others, these functions are crucial to having a cost-effective and efficient distribution system.  It is worth noting that while most product movement is concerned with moving tangible products, some of the issues covered here are also applicable to intangible products, such as services, and to digital products.

Key Issues:

  • What is Wholesaling?
  • Benefits of Wholesalers
  • Ways to Categorize Wholesalers
  • Wholesale Formats
  • Managing Product Movement
  • Ordering and Inventory Management
  • Transportation
  • Product Storage

Links to Cited References:

  1. “2012 Economic Census.” United States Census Bureau
  2. “Market for Electricity.” PJM
  3. Both small general retailers (e.g., neighborhood convenience stores) and specialty retailers (e.g., clothing stores), will often purchase from a variety of wholesalers.  For instance, some retailers may look to websites such as Wholesale Central, which provides information on over 1,000 wholesalers listed in over 50 product categories.
  4. Christ, Paul. “Patenting Marketing Methods:  A Missing Topic in the Classroom.” Journal of Marketing Education. 27 (1), 2005.
  5. For more details see: “About Placing Orders with Alexa.” Amazon
  6. Values do not add to 100% as is does not include combination shipping, including intermodal, and other shipping methods.
  7. “2012 Commodity Flow Survey.” Bureau of Transportation Statistics – U.S. Department of Transportation
  8. For information on various technologies and equipment used in warehouses see: “Warehouse.” Modern Materials Handling
  9. Bray, Hiawatha. “Robots Taking Over in Warehouses.” Boston Globe, May 01, 2017.