The Difference Between a Wholesaler and a Retailer
The difference between a wholesaler and a retailer used to be a bit more simple than it is today.
In the past, the main difference was one of quantity.
A wholesaler sold a very large number of a given item to a retailer, who purchased them at a much-reduced price in consideration of the size of their purchase.
The retailer then took those items, marked up the prices to cover their costs and profit and put them out on the shelves.
This was the traditional arrangement that endured, essentially, until the Internet became one of the dominant means of consumer shopping.
The difference between a wholesaler and a retailer is much more complex now than it was in the past.
When the first Internet stores went up, they were essentially brick-and-mortar stores that added a digital storefront and that offered selections from the stock in their warehouse over the Internet.
While this was a significant change in the way consumers shop, it wasn't the end of the story, by any means.
That story, in fact, continues to unfold today and new elements are always being introduced.
A significant difference between a wholesaler and a retailer used to be found in the quantity.
Retailers used to be required to order very large amounts of goods to avail themselves of discounted prices.
For every DVD player you ever bought at an electronics store, there were probably 100 on a palate in the back room, as well.
Dropshipping is a wholesale model that works off of small orders.
These wholesalers will allow their retail customers to purchase at most any quantity, even as little as one unit at a time, and to do so at wholesale prices, which allows the retailer to maintain their profit margin.
The difference between a wholesaler and a retailer is blurred even more with dropshipping businesses, as they provide some level of customer service.
These businesses also handle the shipping required for any item.
They do so with the retailer's return address and contact information, so the retailer isn't excluded in any way from the relationship with the customer.
These wholesalers are very popular with those who run online auctions, as those retailers can quickly add popular products without making an initial purchase of any sort and without keeping any stock on hand.
This can be a very profitable way to do business.
In the past, the main difference was one of quantity.
A wholesaler sold a very large number of a given item to a retailer, who purchased them at a much-reduced price in consideration of the size of their purchase.
The retailer then took those items, marked up the prices to cover their costs and profit and put them out on the shelves.
This was the traditional arrangement that endured, essentially, until the Internet became one of the dominant means of consumer shopping.
The difference between a wholesaler and a retailer is much more complex now than it was in the past.
When the first Internet stores went up, they were essentially brick-and-mortar stores that added a digital storefront and that offered selections from the stock in their warehouse over the Internet.
While this was a significant change in the way consumers shop, it wasn't the end of the story, by any means.
That story, in fact, continues to unfold today and new elements are always being introduced.
A significant difference between a wholesaler and a retailer used to be found in the quantity.
Retailers used to be required to order very large amounts of goods to avail themselves of discounted prices.
For every DVD player you ever bought at an electronics store, there were probably 100 on a palate in the back room, as well.
Dropshipping is a wholesale model that works off of small orders.
These wholesalers will allow their retail customers to purchase at most any quantity, even as little as one unit at a time, and to do so at wholesale prices, which allows the retailer to maintain their profit margin.
The difference between a wholesaler and a retailer is blurred even more with dropshipping businesses, as they provide some level of customer service.
These businesses also handle the shipping required for any item.
They do so with the retailer's return address and contact information, so the retailer isn't excluded in any way from the relationship with the customer.
These wholesalers are very popular with those who run online auctions, as those retailers can quickly add popular products without making an initial purchase of any sort and without keeping any stock on hand.
This can be a very profitable way to do business.
