Difference Between Wholesale and Retail

Wholesale vs Retail

The terms “wholesale” and “retail” themselves explain the difference. “Wholesale” means “selling in large quantities” and “retail” means “selling in small quantities.”

In wholesale, the goods are mainly sold to the retailer who sells it to the customers. A wholesaler might also sell the products directly to the customers.

One of the main differences between wholesale and retail is in the price of the goods. The wholesale price is always lower than the retail price. This is mainly because the retailer has to include many other costs while selling the goods. The retailer has to add costs like the salaries of employees, rents of shops, sales tax, and advertising of the goods that he buys from a wholesaler. A wholesaler does not worry much about all of these aspects which prompts him to sell goods at a lower price.

The wholesaler has direct links with the manufacturer and buys products or goods directly from him. On the other hand, a retailer has no direct contact with the manufacturer.

In choosing the quality, the retailer has an upper hand. A retailer can choose the products with quality and discard the damaged ones as they only buy small amounts. On the contrary, the wholesaler will not have a say in the quality as he has to buy in bulk from the manufacturer. This means that the retailer has the freedom to choose the products whereas the wholesaler does not have the freedom to choose the products.

It can also be seen that retailers have to spend more in maintaining the retail space as they have to attract the consumers. On the other hand, a wholesaler need not worry about the space as it is only the retailer who buys from him.

When comparing the profit margin, a wholesaler gets more profit than a retailer. But even then, a wholesaler gets more money as he sells in bulk. A retailer just sells only one product at a time.

Summary:

1.In wholesale, the goods are mainly sold to the retailer who sells it to the customers.
2.The wholesale price is always lower than the retail price.
3.The wholesaler has direct links with the manufacturer and buys products or goods directly from him. On the other hand, a retailer has no direct contact with the manufacturer.
4.A retailer can choose the products with quality and discard the damaged ones as they only buy small amounts. On the contrary, the wholesaler will not have a say in the quality as he has to buy in bulk from the manufacturer.

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