Supply chain of any company is a critical piece of the performance. A distributor and wholesaler both play important parts but many times one tends to confuse between the two of them. Let us understand the key and subtle Difference between Wholesaler and Distributer.
What is a Supply Chain?
As the name suggests, a supply chain is a chain of entities, which may be directly or indirectly playing a role towards serving the consumers or customers. The supply chain starts from the vendors who supply raw materials, manufacturers who produce the products, distribution centers that deliver to the retailers and the retailers who sell the products to the end customers. It is a system involving organizations, people, activities, information, and resources.
Who is a Distributor?
Distributors are the ones who are in direct contact with the manufacturers and bring about the channel for the products to deliver to the retailers, resellers etc. They play an important role in keeping the flow of the products between demand and supply running smoothly. They generally are appointed by the manufacturers and assigned for different regions. Additionally they improve the responsiveness as well as the reach of the company. They sometimes even provide logistical and storage support. Typically the distributors purchase directly from the manufacturer and sell to the retailers or businesses.
In today’s world with increased competition and each offering some value adds every now and then, it does not take long for consumers to switch their brand loyalties. It is therefore important to ensure in this fast-paced and demand-driven space, requirements get fulfilled quickly before they start looking for other options. Distributors being localized allow for them to be easily accessible and able to provide for the needs of their customers immediately.
Additionally they offer value-additions like being able to bundle offers at their outlets since they are selling multiple products. Thus a HP distributor may be able to give some discounts for a combination of a printer and it’s cartridges. These cost advantages enable retailers to pass on a portion of it to their customers. Distributors also provide after sales services.
Distributors also have the benefit of reducing inventory and service burdens for both the manufacturer and the user. They provide aftermarket services, cost reduction and process optimization strategies, as well as inventory management. Distributors create value by providing total solutions for their customers.
Who is a Wholesaler?
The wholesalers are organizations wholesaling merchandise, who generally do so bulk quantities to retailers without rendering any post sales services. The wholesaler typically buys from the manufacturer or reseller. The wholesaler buys in large quantities and therefore gets large discounts. The wholesalers sell a wide range of different products from different manufacturers and they may not be tied in to specific brands..
Wholesaler vs. Distributor
The difference between the two still has no mans land in between making it difficult to draw the lines:
A distributor works with a manufacturer as part of their sales ecosystem to sell more goods. The distributor’s role would be similar like that of a wholesaler but is much more driven due to targets. A distributor acts as a sales representative for the manufacturer by actively looking out for orders from various sources in the market, also executing the orders. Thus a distributor is actively involved in promotion, sales and even after sales for a company’s products while a wholesaler is not.
A wholesaler focuses on satisfying the needs of the retailers while the distributor focuses on those of the manufacturers. Wholesalers are generally not responsible for having the products sold to the customers nor are there any targets pinned on them and market driven. Distributors are driven by the manufacturer’s outlook.
Despite their differences, both parties play a key role in the supply chain. Obviously they do make the supply chain a difficult one to track and ensure that there are no cogs in the wheel.
To ensure that the products are proper and in place within your warehouses, Quicsolv’s solution for Warehouses comes handy for manufacturers and distributors. Even tracking vast numbers of distributors and wholesalers would be a nightmare to be done on an excel sheet. Moreover one may want to integrate with legacy systems or even high end ERPs. Quicsolv’s application development services can come handy.
When the end customers, especially businesses, buy your products, it is important for them to track them too. Asset tracking solution like Quicsolv’s Asset Management Software helps one keep track of assets without the need for scanners or rfid methods but a one which works seamlessly bringing increased productivity, while being a simple one to implement and track your assets in real time!!
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