The intermediaries, or distribution partners are also known collectively as resellers. Generally, there are 2 types.
Wholesalers (4 categories)
These are independent companies who buy products from factories and sell them to other wholesalers, manufacturers or retailers.
Full-Service Merchant Wholesalers provide additional services, such as packaging, advertising and warehousing.
Limited-Service Merchant Wholesalers provide only select services or functions.
For example, a full-service citrus wholesaler may offer delivery, help retailers design signage and displays as well as help with advertising and promotional strategies. On the other hand, a limited-service citrus wholesaler may offer lower prices for a similar selection, but the retailers are expected to pay cash and pick up their order.
Agents & Brokers
These are wholesalers who do not take ownership of the inventory. They are typically commission-based intermediaries who negotiate purchases between wholesalers and retailer or manufacturers and wholesalers. Agents are usually permanent employees who work or either the buyer or the seller. Brokers are usually independent contractors hired for a specific transaction.
These are similar to merchant-wholesalers. They typically offer promotional assistance, delivery, and credit to wholesales, retailers, and in some cases, the company’s sales staff. Most often the inventory is expensive, perishable, and requires special handling.
Retailers (4 categories)
These are stores that carry a wide variety of products.
Examples would be Department stores (Macy’s, Robinsons-May, Sears), Grocery stores (Vons, Albertson’s), and Discount Stores (K-mart, Wal Mart, Target).
These are stores that stock a single product line or category. Bakeries (Cinnabon, Mrs. Field’s Cookies, Dunkin’ Donuts), Shoe Stores (Footlocker, Stride Rite, Pay Less), and gift stores (The Sharper Image, Brookstone) fall into this category.
Stores that do not require a customer showroom fall under this category. E-tailers, or internet marketers are the most notable example lately, but telemarketers and direct sellers also fit the criteria.
Franchising combines individual ownership with chain store marketing support. A typical agreement basically allows the franchisee to sell merchandise owned by the franchiser in exchange for a start up fee and a regular royalty.
Fast food restaurants are the most obvious example. McDonald’s determines the overall décor of the stores, the uniforms, and the marketing and national advertising. franchise owners manage the store, the supplies, the capital, and the labor.
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