Wholesale does not comply. The main tasks solved by wholesale trade
One of the most important elements of the distribution and distribution system is wholesale trade - the activity of purchasing products (services) in large quantities for the purpose of resale or professional use.
The most important task of wholesale trade is to systematically regulate product supply in accordance with population demand. The objective possibility of successfully solving this problem is due to the intermediate position of wholesale trade: it concentrates a significant part of commodity resources, which makes it possible not to be limited to passive operations, but to actively influence the sphere of production, retail trade and, through it, the sphere of consumption.
Wholesale trade plays a significant role in the system of economic relations between regions of the country, industries, product manufacturers and retail trade.
Carrying out economic relations with industry and agriculture, wholesale trade acts as a customer of products, its functions include the purchase and delivery of products from manufacturers. It should be noted that it is designed to actively involve local commodity resources in trade turnover and conduct decentralized purchases of products from various sources. By organizing the delivery of products, wholesale trade monitors whether the industry complies with contractual obligations to supply products of the appropriate range and quality, strictly within the stipulated time frame. In the warehouses of wholesale trade enterprises, purchased products are rejected and discounted in case of non-compliance with customer requests or reduction in consumer qualities.
Wholesale trade can and should actively influence the volume and range of products produced, demand the replacement of the production of goods that are not in demand with goods for which the needs are not fully satisfied, and strive to improve the quality and expand the range of products. Wholesale trade has the right to stop accepting and return low-quality products, which forces industrial enterprises to improve their consumer properties.
In order to purposefully influence changes in trade conditions, wholesale trade must have data on the state and future changes in situations in industry and regional markets, research and forecast public demand, and have an idea of the capabilities of suppliers.
The role of wholesale trade involves its active participation in ensuring the sustainable sale of goods to consumers. Wholesale trade enterprises control the completeness of the assortment in the stores of the serviced area, ensuring the constant availability of goods available in warehouses for sale, participate together with suppliers in advertising events, and organize the resale of goods excessively purchased by stores to other areas where there is demand for them.
At the macro level, wholesale trade performs various market functions:
- integrating - to ensure relationships between partners, manufacturers, sellers and buyers - to find optimal sales channels for products;
— evaluative — by determining the level of socially necessary labor costs through pricing;
- organizing and regulating - to ensure the rational construction and harmonious functioning of the economic system with the help of impulses that stimulate structural changes.
The macroeconomic functions of wholesale trade are transformed at the micro level into various subfunctions or functions of wholesale trade enterprises, among which are the following:
— the function of economic integration of territories and bridging the spatial gap;
— the function of converting the production assortment into a trade assortment of goods;
— the function of forming inventories to insure against changes in demand for goods;
— price smoothing function;
- storage function;
— the function of finishing, bringing goods to the required quality, packaging and packing;
— the function of lending to its clients, especially small retail enterprises;
— function of marketing market research and advertising.
Development market relations contributes to the emergence of new elements in the activities of wholesale trade enterprises, for example, the provision of a variety of management and consulting services to its clients.
By connecting production and retail trade, wholesale trade enterprises influence production; compiling a trade assortment and supplying it to retail enterprises; concentration and storage of inventory; creation of rational routes for goods distribution, etc.
Wholesale trade actively influences the production of products, their range and quality by:
— implementation of orders for the production of required products;
— concluding contracts for the supply of goods;
— refusal to accept low-quality products;
— holding wholesale fairs, exhibitions, product reviews, etc.
Wholesale trade enterprises study demand, concentrate and clarify data on population demand received from retail enterprises, and on their basis order products from commodity producers. Thus, wholesale trade enterprises help suppliers draw up production programs, determine the volume and range of products produced and grown, which contributes to the development of production in the right direction.
The study of population demand should not be limited to existing needs. Wholesale trade is designed to stimulate the creation of new types of food, take into account the current demand of the population and anticipate its possible changes, and contribute to the targeted formation of demand. Changes in demand must be promptly taken into account in the process of interaction between wholesale trade and suppliers. Wholesale trade enterprises must conduct strict quality control of food supplied by food producers and prevent the penetration of products that are not in demand into the retail trade network. Quality acceptance and certification of products is carried out by commodity experts of wholesale trade enterprises together with state inspection quality control and chamber of commerce experts through random inspection of incoming consignments of goods. As a result of quality control, the grade of some products is reduced or they are returned to suppliers to eliminate identified defects.
Today, wholesalers must be well aware of the market conditions and meet its needs by seeking additional resources and promoting their better use.
The activity of wholesale trade depends on:
— lack of sale of products that are not in demand among the population;
— updating the assortment and improving its quality;
— ensuring high quality products supplied to retail and catering enterprises;
— introduction of new types of food into production.
One of the functions of wholesale trade is the concentration and storage of inventory necessary to replenish current stocks in retail trade, seasonal and special-purpose products. With an efficient distribution system, it is in wholesale trade that the bulk of inventory should be located, and in retail trade products can be stored within a certain norm, based on customer demand and the availability of warehouse space.
Wholesalers should encourage retailers to purchase goods. At the same time, the development of such wholesale trade functions as commercial lending and transaction financing is of great importance. Experience shows that in many cases the choice of a distribution channel depends on the extent to which its organizer can credit market transactions of interested parties. Wholesale trade enterprises often finance the manufacturer by providing him with an order for a certain batch of products with a guarantee of its sale and paying in advance a part of the ordered products. Wholesalers finance retail enterprises by selling goods on a deferred payment basis.
The attractiveness of wholesalers depends on the level of service offered to customers, which in turn depends on:
— speed of order fulfillment;
— possibility of urgent delivery of products upon special order;
— ensuring different batches of shipment;
— use of the most convenient modes of transport;
— availability of a highly efficient service department;
— sufficient level of inventory;
— price levels for products and services provided.
When choosing a specific wholesale trade enterprise, customers should have information:
— about the range of products;
— about the area of activity;
- about the commercial situation determined by the duration of work in a given market;
— on the technical equipment and organization of technological processes in warehouses and storage facilities;
— the presence or absence of convenient access roads to warehouses;
— about price policy.
For a wholesale trade enterprise, the ability to attract new customers is important.
Wholesale trade, like no other link, is capable of actively regulating regional and industry markets through the accumulation and movement of products. This area of work should occupy a decisive place in all its activities. Wholesale trade enterprises are called upon to improve the chain of distribution of goods, develop centralized supply and circular delivery of products. Currently, there are significant shortcomings in the activities of wholesale enterprises. Product delivery deadlines are often not met, and contractual obligations regarding volume, range and quality are violated.
The efficiency of the functioning of the entire national economic complex, the balance of the domestic market, and the satisfaction of the growing needs of people largely depend on the work of wholesale trade enterprises. Under the new economic conditions, the scope of wholesale trade will be significantly expanded. The strengthening of the role of commodity-money relations is associated not only with the development of wholesale trade in consumer goods, but also with the transition to wholesale trade in means of production. These two forms become the most important channels for the systematic movement of food resources.
2. Types and forms of organizing wholesale trade
IN Russian Federation The process of forming wholesale trade is far from complete, so it is difficult to talk about any established structure of wholesale trade. In countries with traditional market economies, such a structure has long been established. Wholesale trade enterprises are usually divided into four groups as follows.
Wholesalers merchants. The first group consists of wholesalers and merchants - large independent commercial enterprises. According to US data, they account for more than half of total wholesale turnover. Their main feature is that they acquire ownership rights to all goods they deal with.
In turn, wholesalers and merchants are divided into two types - with full and limited service cycles.
Full-service wholesalers include wholesalers and distributors of food products. They collect an assortment of products at a specific location, provide trade credit, store and deliver the products to consumers. In addition, they offer assistance in their promotion and implementation, and provide services. They often act as sales arms of manufacturers.
These wholesalers most widely supply groceries, tobacco products and alcoholic beverages.
Limited-service wholesalers acquire ownership of products, but perform fewer functions—they do not provide credit or assist in the delivery and distribution of goods.
A traveling salesman usually sells and delivers products to customers. Its rather limited range includes food products (milk, bread, snacks), which it offers to supermarkets, delis, hospitals, restaurants and hotels.
Export wholesalers, serving grocery stores and other retailers, offer mainly products and assortments and trade on consignment terms, i.e. retain ownership of the product until it is sold. In this case, they undertake the delivery of products, their placement in retail spaces, maintaining inventories, and financing.
Agricultural production cooperatives are created collectively by farmers and produce agricultural products for sale in local markets. They assign brand names to parts of their products in order to promote them on the market.
In general, merchant wholesalers in Western countries account for more than 50% of total trade turnover.
Agents and brokers. This is a completely different type of wholesaler. They differ in that they do not take ownership of the goods and work on a commission basis. They typically specialize by type of product line or type of customer served. Agents and brokers account for approximately 10% of total wholesale sales turnover.
The main difference between agents and brokers is that agents typically work with clients on a long-term basis, while brokers typically work with clients on a one-time basis. In turn, agents are divided into manufacturers' agents, sales agents and commission agents.
Manufacturer's agents, the largest group of all wholesalers' agents, work for multiple manufacturers and deal with non-competing products with exclusive distribution rights in a specific territory. They enter into formal written agreements with each individual manufacturer regarding pricing policies, distribution locations, ordering procedures, delivery methods, commission rates (usually 5-10% of sales volume), etc.
Sales agents, under the terms of the contract, are responsible for marketing all products of manufacturers, and in essence turn into marketing divisions of manufacturers. They perform all marketing functions except obtaining ownership of the product, and in most cases work for small firms in such areas as the production of canned food.
Agents on commission receive goods on a consignment basis from manufacturers. They are engaged in the selection of products and the organization of their sales. As a rule, such agents work on the basis of short-term agreements. They sometimes offer credit, provide storage and delivery of goods, and receive a commission for their services. Most often, this category of agents is used in the trade of agricultural and marine products.
Unlike agents, brokers do not take on the task of selecting products, storing and delivering them, much less financing them, but are engaged in connecting buyers with sellers and helping them negotiate. As a rule, they are well informed about the state of the market, terms of sale, sources of credit, pricing, potential buyers, and receive commissions from buyers of goods for their services. Brokers are most common in food markets. The share of agents and brokers in the wholesale trade turnover of Western countries reaches 10%.
Wholesale branches and manufacturers' offices. In order to more strictly control the processes of inventory management and sales promotion, manufacturers often create their own wholesale branches and offices to sell their products. Sales departments are more often created at enterprises of individual food products and, in addition to sales, take on the functions of storing inventory.
Specialized wholesalers. Another type of wholesale trade is represented by our own specialized wholesale organizations, which include wholesalers - buyers of agricultural products. Thus, wholesalers - buyers of agricultural products usually buy products from the population and the producers themselves - farmers, co-operators, small private owners, and form larger batches for shipment to food industry enterprises, bakeries, bakeries and wholesale enterprises.
IN last years XX century The structure of wholesale trade is changing significantly. Independent wholesalers are especially active, trying to more thoroughly establish themselves in distribution channels. To do this, they pay special attention to gaining a competitive advantage, creating a sense of commitment in the consumer to the brand of a product or company, and receiving a reasonable share of the profit.
Wholesale turnover is one of the main indicators of economic activity of wholesale enterprises. Its volume and structure characterize the degree of development of production and the level of public consumption.
Depending on the volume, structure, types and forms, the indicators of the economic and financial activities of the enterprise are determined.
There is a distinction between primary wholesale turnover - this is the sale of goods by industrial enterprises directly to retail and wholesale enterprises, as well as intermediary turnover - this is the sale of products by wholesale enterprises - to retailers.
Wholesale turnover has a different economic content than revenue from sales of products in industry or retail turnover.
Wholesale turnover does not reflect the production and sale of goods directly to the population for personal consumption, but characterizes the movement of goods from the sphere of production to the sphere of circulation.
Based on the size of turnover, they are distinguished: large, medium and small turnover.
— Large wholesale trade turnover occurs when large political parties receive goods from enterprises and send them through the wholesale trade chains.
— The average wholesale turnover is formed by wholesale enterprises that buy products not only from industry, but also from other large wholesale enterprises.
-Small wholesale trade turnover is formed at wholesale bases at grassroots wholesale enterprises.
Depending on the purpose of commodity resources, wholesale trade turnover is divided into three types:
— sales turnover;
— intrasystem;
- inter-republican;
Wholesale sales turnover includes the sale of goods to organizations and retail enterprises located in the area of operation of the wholesale enterprise.
Intra-system wholesale trade turnover determines the mutual release of goods by wholesale enterprises into one system within one system.
Inter-republican trade turnover covers the sale of goods outside the republic on the basis of free purchase and sale.
Thus, intra-system and inter-republican wholesale trade turnover reflect the movement of goods between wholesale trade links.
The sum of the three types of wholesale trade turnover is the gross wholesale trade turnover.
Wholesale trade turnover for each of the three types is divided into two forms:
1) Warehouse (sale of goods from warehouses of wholesale enterprises. Goods brought to warehouses are checked, sorted, packaged, and so on).
2) Transit (delivery of goods is carried out directly to retail, wholesale, bypassing intermediate links).
Wholesale sales of goods in transit can be carried out with participation in settlements (with investment of funds) and without participation in settlements (organized turnover).
Transit turnover with participation in settlements is calculated first with suppliers, and then, as a seller of the product, presents invoices for payment to customers. At the same time, wholesale enterprises use their working capital, use bank loans, pay profit tax to the budget, and receive wholesale and distribution price concessions.
Transit turnover without participation in settlements involves only the intermediary activity of wholesale trade, while payments for goods are made directly by producers and buyers between themselves. The role of the wholesale link is limited to organizing contractual relations and supplies of goods. It participates in placing orders and drawing up specifications for goods, and monitors the progress of their shipment. In this case, wholesale enterprises do not receive wholesale price reductions.
The growth of wholesale trade, as evidenced by global experience, is determined by the following significant trends in the economy:
— the growth of mass production at large enterprises remote from the main users of finished products;
— increasing the volume of production for future use, and not for the fulfillment of specific contracts already concluded;
— increasing the number of levels of intermediate producers and users;
— the increasing need to adapt goods to the needs of intermediate and final consumers in terms of quantity, packaging and varieties.
In accordance with this, wholesale trade performs the following tasks:
1. Directs the flow of goods from the producer to the consumer. Many material goods acquire market value only because trade brings them to the right place.
2. Assumes the storage of inventories necessary to ensure timely supplies to customers when demand changes.
3. Bridges the time gap between producer and consumer. Agricultural products such as grain, sugar beets, and potatoes are purchased during the harvest period and stored until demand arises. This allows you to regulate shortages and surpluses, and avoid significant price fluctuations.
4. Encourages new demand. Even a technically complex product acquires economic value only when there is a buyer for it.
Conclusion
Wholesale trade is the sale in large quantities of items of material and technical equipment, raw materials (for light and food industry enterprises), consumer goods to enterprises and organizations for processing or resale. Wholesale trade is characterized by two main features that distinguish it from retail:
1) sale of goods, raw materials, materials in large quantities to organizations and enterprises
2) sale for subsequent processing or resale.
The main function of a wholesale enterprise is to sell goods to customers; therefore, the volume of these sales, or wholesale turnover, characterizes the volume of activity of the enterprise as a whole.
Wholesale sales can be carried out from the enterprise's warehouse or bypassing the warehouse, directly to the buyer.
The volume of wholesale sales from a warehouse is called warehouse turnover, and without delivery to a warehouse - transit turnover.
The sum of warehouse and transit turnover constitutes the total, or gross, turnover of a wholesale enterprise.
Thus, the total wholesale turnover represents the total volume of sales of goods to manufacturing and trading enterprises, as well as intermediaries to other enterprises and legal entities for subsequent sale to the population or for industrial consumption.
Analysis of wholesale trade turnover allows trading enterprises to determine to what extent the trade turnover plan has been fulfilled and whether customer demand has been satisfied, what changes have occurred in trade turnover during the reporting period and how they are justified, to reveal new phenomena, as well as existing reserves in the development of trade turnover. Conclusions and generalizations are important for developing a forecast for product sales.
Any enterprise in conditions market economy constantly plans its activities. The result of the planned work is a constantly updated document - the business plan of the enterprise.
Wholesale bases independently draw up plans for warehouse and transit trade turnover, determine the structure of trade turnover, and the size of inventory.
Wholesale enterprises draw up a turnover plan independently for the year with a quarterly breakdown, and then clarify the turnover plan for each month of the quarter
The process of planning wholesale trade turnover is a complex, sequential, multi-stage process, the stages of which naturally follow one another, and they are all interconnected, there is a balance connection between them. From the material studied, it is clear that the amount of trade turnover is influenced by a large number of different factors: fluctuations in demand, the level of inflation, the stability and size of the population’s monetary income, etc.
Bibliography
1. Bakanov M.I. Analysis of economic activities in trade. – M,: Economics 2011.
2. Grekhovodova M.N. Economics of a trading enterprise. Textbook – Rostov n/d: “Phoenix”, 2010.
3. Daneburg V., Moncrief R., Taylor V. Fundamentals of wholesale trade. Practical course. – Spouse-Petersburg: Neva-Ladoga-Onega, 2012.
4. Nagovitsina L.P. How to manage inventory. – M.: Economics, 2011
5. Entrepreneur's Directory: retail trade, wholesale trade, freight transport, catering and hotel management. – M.: Nauka, 2013.
6. Trading business: economics and organization: Textbook / Under the general editorship of prof. L.A. Bragina and prof. T.P. Danko - M.: INFRA - M, 2014.
7. Economics and organization of activities of a trading enterprise: Textbook / Ed. A.N. Solomatina - 2nd ed., revised and expanded - M.: INFRA - M, 2013.
8. Economics of a trading enterprise: Textbook for universities / A.I. Grebnev, Yu.K Bazhenov and others; — M.: Economics, 2016.
9. Economics of a trading enterprise / Textbook for commodity experts / Kazarskaya N.I., Lobovikov Yu.V. – 5th edition, revised. and additional – M.: Economics, 2016.
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Wholesale- this is a set of intermediary operations between economic entities for the purpose of marketing (selling) products, on the one hand, and acquiring (purchasing) goods for their subsequent use in production and sale to retail trade enterprises for subsequent sale to the public, on the other.
Wholesale trade is the most important link in free interaction between participants in the act of purchase and sale of goods. It acts as a trade intermediary between goods manufacturers, retailers, food establishments and other wholesale consumers. Wholesale trade enterprises sell goods for subsequent resale or processing.
Wholesale trade in the market is carried out different kinds wholesale trading enterprises.
Wholesalers differ from retailers in a number of ways:
1. Wholesale transactions, as a rule, are large, the trading area is large.
2. The wholesaler pays little attention to sales promotion and the location of his enterprise, since he deals with professional clients, and not with the end consumer.
3. Differences in legal support and tax legislation (applicable in countries with developed market economies).
Main functions of a wholesale enterprise:
· supply of goods to retail trade enterprises;
· assortment of goods in accordance with the requirements of retail trade enterprises;
· organization of timely delivery of goods;
· study of population demand;
· influencing industry to produce goods in accordance with demand, in the required consumer range and of high quality;
· organizing the supply of goods for export;
· storage of goods inventories.
Wholesale trading enterprises are classified according to a number of criteria:
By product specialization:
· universal with an unlimited range of food or non-food product groups;
· specialized, having an assortment of certain groups of food or non-food products.
By territorial scale of served markets:
· nationwide;
· regional.
By functional focus (place and role in the process of product distribution):
· wholesale and distribution (output bases);
· trade and purchasing bases;
· wholesale trading centers;
· wholesale and retail associations (ORO)
As market relations develop, new types of wholesale enterprises of various organizational and legal forms are created. These can be joint stock companies, holding companies, associations, concerns, trading houses, wholesale markets, commodity exchanges, auctions, fairs, etc.
In recent years, certain positive trends in the development of the urban wholesale sector have emerged, which are a direct reflection of the action of market laws and mechanisms. These include:
Strengthening corporate principles in the organization, interaction and interpenetration of the wholesale and retail trade links;
Universalization of the activities of wholesale enterprises;
Shifting the functions of wholesale enterprises with a relatively developed warehouse base towards the provision of storage services to wholesale market operators;
Acquisition by food and processing enterprises of the functions of wholesale trade and wholesale procurement of raw materials;
An increase in the number of wholesale structures acting as organizers of wholesale turnover;
Involving wholesale trade structures of the city in the processes of interregional interaction.
At the same time, the existing system of food distribution, the achieved level of development of the wholesale market and the organization of wholesale trade in food products in Moscow have major shortcomings and unresolved problems, including:
Insufficient social orientation of retail trade with a lack of distribution centers to service discount stores and their analogues in the wholesale segment;
High distribution costs due to the low level of logistics organization; the presence of up to 6 links of intermediaries in the commodity distribution network, most of which are neither organizationally nor technologically necessary;
Storage of part of the volumes of imported food (for individual product groups up to 50%) in unsuitable premises: workshops and warehouses of industrial enterprises, non-residential premises, garages, sports facilities, etc. The existence of this channel removes significant volumes of food products from the system of state quality control and tax control;
High import dependence of the city's food supply, exceeding 80% for certain product items (meat, animal oil, fruits). At the same time, commercial organizations purchasing food for urban needs do not actively market the Russian market and prefer to work with foreign suppliers. There is practically no system for monitoring the conditions of the Moscow wholesale food market;
There is a well-known monopolization of certain sectors of the city's food market, including by Moscow commodity producers.
Many wholesale fruit and vegetable enterprises are in a difficult financial situation and have significant overdue debts to the federal and city budgets. The own trading activities of wholesale enterprises are limited; They have lost, in particular, their positions in the most profitable sectors of the fruit and vegetable market.
The depreciation of fixed production assets at most wholesale enterprises reaches 65 - 85%. Significant investments are needed in their technical re-equipment and ensuring chemical safety.
The organizational and economic mechanism for purchasing food for urban needs requires significant adjustments. It is necessary to increase the effectiveness of the impact of these purchases on the price environment and the development of the wholesale food market, to reduce the burden on the city budget for financing and lending purchases for the formation and maintenance of the city food fund.
The regulatory framework for wholesale trade is insufficiently developed. There are problems in the area of property and land relations, including regarding the conditions for attracting investors and developers to wholesale food markets and managing the city’s shares in joint stock companies at wholesale enterprises.
The use of intermediaries in the sphere of distribution is primarily beneficial to manufacturers, since in this case they deal with a limited circle of people interested in selling the product. The number of direct contacts between the manufacturer and end consumers is reduced while ensuring wide market coverage. Large wholesale centers, small wholesalers, trading houses and shops can act as intermediaries. The use of intermediary structures is due to a number of reasons: the need to invest certain financial resources in organizing the distribution process; availability of knowledge and experience in the field of analysis of market conditions, trade and distribution methods to optimize the distribution network of the enterprise.
Thanks to established contacts with consumers and other market participants, intermediaries are able to ensure the availability of goods to a wide circle buyers, bringing it to target markets. They eliminate long-standing gaps in time, place and ownership that separate goods and services from those who want to use them.
Intermediaries perform a number of important functions:
- 1) market research– determining customer preferences, collecting information about competitors;
- 2) sales promotion - creation and distribution of persuasive communications about the product;
- 3) establishing contact– establishing and maintaining relationships with potential buyers;
- 4) product adaptation – customization of goods to customer requirements (sorting, installation, packaging);
- 5) conduct of negotiations - negotiation of prices and other delivery conditions;
- 6) organization of product distribution– delivery, warehousing and transportation;
- 7) financing– finding funds for lending to channel participants and covering the costs of its operation;
- 8) risk taking– accepting responsibility for bringing goods to end consumers.
The fulfillment of the first five functions contributes to the conclusion of a deal, and the remaining three - the implementation of already concluded deals. These functions can be performed either by an intermediary or by a manufacturer. However, if part of them is performed by the manufacturer, costs increase, and hence the price. The issue of the effectiveness of joint activities is related to how the manufacturer and intermediary distribute these functions among themselves. When transferring some functions to intermediaries, costs, and therefore manufacturer prices, are reduced. The effectiveness of the enterprise's distribution network depends on the efficiency of the distribution of functions inherent in the channel among its participants. Since the tasks performed by intermediary structures are varied, the following categories are distinguished: wholesale intermediaries, retailers, specialized intermediaries.
Wholesale intermediaries make a profit by buying goods at wholesale prices and selling them at a markup, while deducting distribution costs.
Retailers sell goods to end consumers for their personal, non-commercial use.
Specialized intermediaries They implement specific flows in the distribution channel and are usually not involved in production. These include: insurance companies; financial credit card companies; advertising agencies involved in promoting products to the market; logistics and transport companies; companies conducting market research.
Wholesale
Wholesale trade is the business activity of selling goods or services to those who purchase them for the purpose of resale to retail trade organizations or other wholesale organizations, but not to individual final consumers. Wholesale trade is an important part of distribution and solves many marketing problems. The role of wholesale trade is to maximally satisfy the needs of retail chains by supplying them with the necessary goods in certain volumes and on time. Usually located in large cities, wholesale companies know the needs of end customers well and can organize marketing support for retail trade. Experience shows that wholesale companies carry out sales functions better than manufacturers, since they have constant contacts with the retail network and have developed warehouse and transport facilities. Wholesale trade is an important lever for maneuvering material resources, helps reduce excess product inventories at all levels and eliminate commodity shortages, and takes part in the formation of regional and sectoral commodity markets. Through wholesale trade, the influence of consumers on producers is enhanced; in turn, the manufacturer himself chooses consumers. Wholesalers provide partners not only with goods, but also with a wide range of services: advertising at the point of sale; delivery of goods; pre-sale preparation, including packaging and packing; organizing sales promotion events. In the market for technically complex goods, wholesale firms organize service centers with the support of manufacturers. Wholesalers receive title to the product and physical possession of it; have warehouses for storing goods, often from several or many manufacturers; engage in product promotion; regulate problems of financing, orders and payments with their customers.
Wholesale intermediaries make a profit by buying goods at wholesale prices and selling them at a markup, while deducting distribution costs. The activity of any intermediary increases the cost of the goods. Therefore, the task of the wholesale link of the distribution system is to form a minimum wholesale margin (through the rationalization of trade and logistics operations) or to give the product additional value for the buyer who perceives the set price as fair.
Since the wholesale intermediary must satisfy the interests of manufacturers, retailers and final consumers, many methods and forms of wholesale trade have emerged.
Classification of wholesale trade. By breadth of assortment can be broad (1–100 thousand items), limited (less than 1000 items), narrow (less than 200 items) and specialized.
By delivery method Wholesale trade is divided into the following types: delivery by own transport, sale from a warehouse (pickup).
According to the degree of cooperation highlight: horizontal cooperation for joint procurement and organization of wholesale markets; vertical cooperation for sales purposes and competition with retailers for end-consumer markets.
By turnover size Wholesalers are divided into large, medium and small.
From the point of view of organizing wholesale trade There are three general categories: wholesale trade of the manufacturer, intermediary enterprises, carried out by agents and brokers.
Trade carried out by manufacturers through their own sales forces requires the creation of a subsidiary wholesale company. The activities of such a company are justified if the range and volume of products produced are sufficient for their profitable sale. Otherwise, it is advisable to transfer the functions of the wholesale link to independent companies. Manufacturer's sales representatives, agents, and brokers generally do not obtain title or physical possession of the product. They promote the product and negotiate terms of sale.
The choice of type of trade for a wholesaler is determined taking into account the desire and size (power) of the retail organization. Wholesale trade with personal selection is advisable when the retailer needs to make an urgent purchase (warehouse stocks are running out), select a “hot” assortment, get a new product for sale, and discounts for pickup. Personal selection is used when purchasing garments, fabrics, fur products, etc.
To demonstrate market novelty goods, the wholesaler often equips a demonstration or exhibition hall. During personal selection, a survey of visitors and testing of products can be conducted. The results should be taken into account during the procurement and sale of demonstrated products. For many standard products, personal selection is organized using self-service. The movement of selected products is carried out using small-scale mechanization: stackers, cargo trolleys, transport roller conveyors, etc.
Wholesale trade by written application or telephone is carried out on the basis of a pre-signed agreement between the seller and the buyer, which stipulates the terms of payment for the order. Delivery of goods to the store can be carried out by transport of a wholesaler or retailer. The reliability of the wholesale delivery system will determine whether the retailer will save time or whether the delivery speed will not suit him.
Wholesale trade with the help of traveling sales agents and managers has become widespread, being the most active form of distribution. A wholesale company organizes an agent network to find buyers - smaller wholesalers and stores. Traveling agents maintain contact with customers, monitor the availability of goods in the store’s sales area, their display, timely payments for goods, etc. Sales agents are usually assigned to a specific territory, a group of customers, or a product range.
Wholesale trade using telemarketing (calls from the office or sales department) requires the creation of a dispatch service and training of personnel in the skills of conducting telephone conversations. Dispatchers transmit the information received about potential buyers to the sales department. The dispatch service can accept orders from customers, conduct telephone surveys, and maintain sales statistics.
Wholesale trade at exhibitions and fairs allows you to conclude supply contracts during a visit to the exhibition by the buyer's representatives or conduct preliminary negotiations. The presence of a large number of professionals (manufacturers, intermediaries, consumers) at such events makes it possible to obtain the latest information about market conditions, new products, competitors’ achievements, etc. At exhibitions, it is advisable to conduct promotional campaigns aimed at consumers.
Wholesale intermediaries perform the following functions:
- purchase for consumers– forecasting demand and, based on analysis of the results, forming an assortment for consumers;
- sales and promotion for manufacturers– providing manufacturers with a sales force to reach retailers and business users. Retail operators and business buyers have more contact with wholesale intermediaries than with the manufacturer and trust them more;
- storage of stocks at low prices– reduction of inventories, warehouse investments and risk of suppliers and consumers;
- transportation – ensuring the fastest and most efficient delivery due to proximity to the manufacturer;
- breakdown of large parties – purchasing on an economical scale for onward distribution in smaller quantities to retailers and business consumers;
- provision of marketing information– manufacturers about consumer requests, competitors’ activities, industry trends; consumers – about new products;
- financing– providing credit to the manufacturer or consumers, buying products before selling them;
- risk taking– when transporting and storing products, the intermediary assumes the risk of damage, theft or obsolescence of the goods;
- managerial, methodological and technical services– a wholesale intermediary can conduct training for retail partners, provide methodological and technical assistance in setting up points of sale.
Types of wholesale intermediaries. All wholesale intermediaries can be classified according to the following criteria: form of ownership of intermediary structures; ownership of promoted goods and services.
By type of ownership of intermediary structures Wholesale intermediaries are divided into three groups: wholesalers owned by the manufacturer (distribution or sales service, manufacturer stores); independent wholesale intermediaries; cooperatives and retailer-owned purchasing offices.
The manufacturer can distribute products through its own sales departments, which provides direct control over supply. Such control is important for technical systems that require installation and maintenance; perishable goods; consulting services. In addition, the sale of high-value goods allows the manufacturer to profitably sell them directly to the end consumer.
The manufacturer's own wholesale sales structures include sales branches (sales), sales office, trade fairs, shopping centers.
Sales branch stores inventory and processes orders for goods, performs warehousing functions, and serves as a sales office for sales representatives in its territories. They dominate marketing channels selling machinery and equipment.
Sales office maintains no product inventory but serves as a regional office for the manufacturer's sales personnel. Being close to the consumer allows you to reduce sales costs and provide effective customer service.
Trade fair– periodic display by the manufacturer of its goods to wholesale and retail customers.
Shopping mall– provision by the manufacturer of space for permanent exhibitions of goods. In Moscow, such centers were opened by companies such as Sony, Samsung.
Ownership of promoted goods and services may remain with the manufacturer or be transferred to independent intermediaries.
Types of intermediaries. In relation to manufacturers, intermediaries should be divided into dependent and independent.
They purchase goods from manufacturers as their own for subsequent resale at an acceptable markup that covers their costs and generates profit (Fig. 5.2).
Rice. 5.2. Independent intermediaries
They do not purchase goods as their own, but receive commissions from manufacturers for the sale of products (Fig. 5.3).
Most wholesale companies promote products to the regions by creating a dealer network. Dealers are independent resellers authorized by one or a limited number of selling companies to provide support to end consumers. The regional dealer ensures regular purchases of goods and plans purchases and sales. The reduction in the number of dealers during the default period led to the fact that the most proactive and enterprising remained on the market. For example, a Moscow dealer company, representing a large foreign shoe retail chain, opened a store branch in one of the cities of Siberia, using its accumulated experience. Design of a new store, trade equipment, non-standard solutions for store presentation, concept
Rice. 5.3. Dependent Intermediaries
sales, used by a foreign manufacturer, allowed the company to attract the attention of local consumers, announce itself in the city as a representative of advanced technologies, and significantly increase sales. The dealer usually has a parallel business, focusing on different consumer segments, incurring its own costs for business development and receiving all the profits from sales.
Distributor– an individual or legal entity – a wholesale intermediary serving various industries, having warehouses and vehicles and carrying out commercial activities on its own behalf and at its own expense. Generalist distributors provide a specific geographic region with a greater variety and quantity of products. Specialized distributors distribute a narrow range of products and provide consumers with the necessary information. Generalist distributors are also called wholesalers, multi-product or wide-range distributors, and distributors with their own warehouse. Their advantages are: a wide range of goods, its availability; competitive pricing; established relationships with clients.
The reasons for the rapid pace of change in the activities of intermediaries are related to the increased volume of information and the speed of its transmission via the Internet and email. Today it is necessary to adapt very quickly to new market conditions and a new type of consumer. Economic instability also makes it difficult for intermediaries to operate, forcing them to change their strategy in the market. For example, specialty distributors are looking to add new product lines to make their business less sensitive to changes in market conditions.
Wholesale traders are divided, depending on the range of functions they perform, into full-functional and limited-functional.
Full-featured wholesalers provide a full range of services for retail and business consumers. They are able to quickly deliver goods to consumers while minimizing inventories. A wholesaler has a staff of salespeople who contact retail consumers, arrange delivery, and provide credit to customers.
Full-featured wholesalers primarily engage in the sale of medicines, groceries, and small machinery and equipment are sold at the business goods market. Full-featured wholesalers include shelf wholesalers (rack jobbers).
Jobber- an intermediary in the market who, like a wholesaler, collects goods into a general category from a number of manufacturers and sells them to retailers. Jobbers store and supply goods (hygiene products, toys) to retailers, place them on shelves, design points of sale, set prices, and visit stores to replenish shelves with their goods.
Limited-functional wholesalers are divided into four categories: pay-and-collect wholesalers, truck-based wholesalers, short-haul forwarders, and mail-order wholesalers.
Wholesaler "pay and collect" (Cash & Carry) does everything wholesale functions, in addition to financing and delivery, will sell current demand goods to small stores and other retail outlets for cash. The client comes to pick up the goods himself, pays for it and takes it to his retail network. German network markup Metro Cash & Salu for goods for business buyers (cafes, small traders) is about 10%, while in large Russian chains for individual buyers it reaches 25-50 %.
Wholesaler on a truck engages in the sale of products with a limited shelf life (bread, milk, fruit, candy, etc.). We deliver goods in small quantities for cash to shops, cafes, and supermarkets.
Short-route forwarder accepts orders from consumers and forwards them to the manufacturer, who in turn forwards the ordered product to the consumer. The forwarder assumes ownership of the ordered goods, bears the risks for the period from the receipt of the order until the delivery of the products to the customer, but does not store or transport inventories. Operates in the sales market of bulky goods - timber, coal, etc.
Mail order wholesaler Distributes catalogs by mail or truck delivery that customers order by mail or telephone. Operates in the jewelry, cosmetics, and sporting goods markets.
Dependent wholesale intermediaries may take over the storage and transportation of products, but never take ownership of the goods. The main function is to bring the buyer and seller together.
Agents and brokers are divided into five groups: commission dealers, auction houses, brokers, sales agents, manufacturers' agents.
Commission merchants take physical possession of goods. They often take agricultural products from farmers, bring them to the market and sell them.
Auction house brings together buyers and sellers in one place, provides buyers with the opportunity to familiarize themselves with the product before making a specific offer on the terms of sale. Products of different price levels are also sold at online auctions. Trade through an auction house is used when selling art objects and furs.
Broker works mainly to bring the seller and buyer together and help in the negotiation process. Represents either the seller or the buyer, but not both. Receives payment from the client after the transaction is completed. Operates in industries where there are many small suppliers and buyers (real estate market, valuable papers). Since it is involved in one-time transactions, it cannot be an effective distribution channel.
When creating a stable distribution channel, a company can choose a sales agent or a manufacturer's agent as a partner.
Sales agent(sales agent) has the right to make decisions on prices, promotion of goods, and provides financial support to the manufacturer. Often he has the exclusive right to sell products, working as an independent marketing service, since he is responsible for the marketing program for the client company's product. This is usually due to the inability of the client or manufacturer to make sales. Works in the field of sales of products from the textile, engineering, and metallurgical industries.
Manufacturer's agents organize sales on the manufacturer’s terms (price, territory, delivery services and guarantees, commission percentage is specified in the contract). They serve representatives of small businesses who cannot maintain their own staff of regional salespeople. They work with several clients at the same time and are used to develop new markets. They sell furniture, clothing, electrical goods, etc.
Cooperatives and purchasing offices Owned by retail operators, they conduct wholesale sales on the market. Retail stores can join forces to organize joint purchases and form purchasing groups that include several stores. Such purchases provide cost savings due to the purchase of large quantities of goods. A group of retail stores can form a purchasing cooperative. Large retail chains create their own centralized purchasing offices to conduct direct purchases from manufacturers.
An important link that ensures the necessary intensity and acceleration of the process of goods distribution in the context of the transition to market relations is wholesale trade, the main task of which is the trade of goods with their subsequent resale or professional use. By organizing the movement of goods through distribution channels, wholesale trade helps synchronize the production and consumption of goods.
Being an integral part of a unified system of commodity distribution, wholesale trade requires a radical restructuring. Therefore, one of the important long-term tasks of state policy in the field of development of wholesale trade is its structural restructuring, providing for the dissemination of such forms of its organization that should be maximally focused on small businesses among users of wholesale services.
In recent years, there has been a sharp decline in the volume of wholesale transactions. The role of wholesale enterprises in supplying retail trade enterprises with goods has significantly decreased. In this regard, the second important task of state policy in the field of development of wholesale trade is to stop the decline and stabilize the volume of wholesale transactions.
The existing potential of the wholesale link should be actively used to stimulate and fully support interregional integration processes in the consumer market.
The existing material and technical base of wholesale trade has been created over many decades. Warehousing needs updating. This should happen not only through the construction of new modern warehouses equipped with advanced technological equipment, but also through the reconstruction and technical re-equipment of existing warehouses, and the rationalization of the existing material and technical base.
Among other objectives of state policy in the field of development of wholesale trade, it is necessary to note the development of a competitive environment and overcoming monopolism in the wholesale trade market, as well as stimulating the work of the wholesale link to introduce active forms of promotion of domestic goods to the market.
In connection with the new tasks put forward for wholesale trade, the goals of its development should be:
- * creation of a developed structure of distribution channels;
- * maintaining proper intensity of trade flows;
- * formation of reserve sources of financial support for the goods distribution process;
- * ensuring savings in total distribution costs.
In a market-oriented system of economic relations, the functions of wholesale trade also change. So, in relation to wholesale buyers, its functions should be reduced to:
- - assessing needs and demand;
- - transformation of the industrial assortment into a commercial one;
- - accumulation and storage of inventory;
- - delivery of goods;
- - lending;
- - information and consulting services.
The functions of wholesale trade in relation to suppliers of goods should be as follows:
- - concentration of commercial activities;
- - support for the process of transfer of ownership of goods;
- - investment support for the product distribution process;
- - minimizing commercial risk;
- - marketing services.
Reorientation of wholesale trade in terms of target and functionality will not only create conditions for deepening reforms in trade, but will also ensure the strategic stability of the consumer market as a whole.
Wholesale trading activities provide services to goods manufacturers and retailers. As a result of its activities, the product moves closer to the consumer, but does not yet fall into the sphere of personal consumption.
The most important goal of wholesale trade is to systematically coordinate product supply in accordance with demand. The objective possibility of successfully solving this problem is due to the intermediate position of wholesale trade: it concentrates a significant part of commodity resources, which allows us not to be limited to passive operations, but to rapidly influence the sphere of production, retail trade and, through it, the sphere of consumption.
Wholesale trade, like no other link associated with the sale of goods, is capable of actively regulating regional and industry markets through the accumulation and movement of goods. This area of work should occupy a decisive place in all its activities. Wholesale enterprises are called upon to improve the distribution of goods, develop centralized supply and circular delivery of goods. Currently, along with the positive aspects, there are significant shortcomings in the activities of wholesale enterprises. Frequently, delivery deadlines for goods are not met, and contractual obligations regarding the volume, range and quality of goods supplied are violated. The efficiency of the functioning of the entire national economic complex, the balance of the domestic market, and the satisfaction of the growing needs of people largely depend on the work of wholesale trade. Under the new economic conditions, the scope of wholesale trade will be significantly expanded. The increasing importance of commodity-money relations is associated not only with the development of wholesale trade in consumer goods, but also with the transition to wholesale trade in means of production. These two forms become the most important channels for the systematic movement of material, technical and commodity resources.
The main indicator of the economic activity of enterprises and wholesale trade organizations is wholesale turnover. It represents the sale of consumer goods and industrial goods for subsequent sale to the population, as well as supplies for non-market consumers and exports. Wholesale trade turnover reflects the transition of goods from the sphere of production to the sphere of circulation and their movement within the sphere of circulation. Its volume, structure, types and forms of product distribution predetermine other important indicators of economic activity. The main goal of analyzing the trading activities of wholesale enterprises is to identify, study and mobilize reserves for the development of trade turnover, improve customer service, and improve product distribution. In the process of analysis, it is necessary to assess the implementation of plans for wholesale trade turnover and delivery of goods to customers; study them in dynamics; identify and measure the influence of factors on the development of wholesale trade; study the causes of shortcomings in trade and commercial activities, if any, and develop measures to eliminate and prevent them; determine the strategy and tactics of marketing activities of a wholesale enterprise. The analysis should show how a wholesale enterprise in its economic activities takes into account the socio-economic development of the region it serves, the production capabilities of industrial enterprises and other suppliers, the availability of commodity resources, the volume and structure of the expected receipt of goods from other regions of the republic, near and far abroad.
Wholesale trade plays a significant role in the system of economic relations between regions of the country, industries, manufacturers of goods and retail trade. Carrying out economic relations with industry and agriculture, wholesale trade acts as a customer of consumer goods, its functions include the purchase and delivery of goods from manufacturing enterprises. It should be noted that it is designed to actively involve local commodity resources in trade turnover and conduct decentralized purchases of goods from various sources. By organizing the delivery of goods, trade controls whether the industry complies with contractual obligations to supply goods of the appropriate range and quality, strictly within the stipulated time frame. In the warehouses of wholesale enterprises, purchased goods are sorted and discounted if they do not meet the needs of customers or reduce their consumer qualities.
Wholesale trade can and should actively influence the volume and range of products produced, demand the replacement of the production of goods that are not in demand with goods for which the needs are not fully satisfied, and strive to improve the quality and expand the range of products. Wholesale trade has the right to stop accepting and return low-quality goods to industry, which forces industrial enterprises to improve their consumer properties.
In order to purposefully influence changes in trade conditions, wholesale trade must have data on the state and future changes in situations in industry and regional markets, research and forecast public demand, and have an idea of the capabilities of suppliers.
The role of wholesale trade involves its active participation in ensuring the sustainable sale of goods to consumers. Wholesale trade enterprises control the completeness of the assortment in stores in the service area, ensuring the constant availability of goods in warehouses for sale, participate together with industry in advertising events, and organize the resale of goods over-purchased by stores to other areas where there is demand for them.
At the macro level, wholesale trade performs various market functions:
- · integrating - to ensure relationships between manufacturing partners, sellers and buyers - to find optimal sales channels for products;
- · evaluative - by determining the level of socially necessary labor costs through pricing;
- · organizing and regulating - to ensure the rational construction and harmonious functioning of the economic system with the help of impulses that stimulate structural changes.
The macroeconomic functions of wholesale trade are transformed at the micro level into various subfunctions or functions of wholesale trade enterprises, among which are the following:
- · function of economic integration of territories and bridging the spatial gap;
- · function of converting the production assortment into a trade one
- · range of goods;
- · function of forming inventories to insure against changes in demand for goods;
- · price smoothing function;
- · storage function;
- · the function of finishing, bringing goods to the required quality, packaging and packing;
- · function of lending to its clients, especially small retail enterprises;
- · function of marketing market research and advertising.
The development of market relations contributes to the emergence of new elements in the activities of wholesale enterprises, for example, the provision of a variety of management and consulting services to their clients.
The functions of wholesale trade can also be divided into two types:
- 1) traditional - mainly organizational and technical (organization of wholesale purchase and sale, warehousing and storage of inventories, transformation of the range of goods, their transportation);
- 2) new ones that arise under the influence of market development.
The organization of wholesale purchase and sale has been one of the most important functions of wholesale trade since, in the process of the social division of labor, it became an independent sub-sector of trade. When contacting product manufacturers, wholesale intermediaries act as representatives of demand, and when offering goods to customers, they act on behalf of manufacturers. Wholesale enterprises organize the delivery of goods to various regions of the country, thereby improving the territorial division of labor. The transport function is manifested when goods are delivered from the enterprise’s warehouses to the retail network or to off-market consumers in their region.
All wholesalers can be divided into four groups:
- 1. Wholesalers-merchants: Wholesalers with a full service cycle, wholesale traders, distributors of industrial goods, wholesalers with a limited service cycle, wholesalers selling for cash without delivery of goods, wholesalers-traveling salesmen, wholesalers-organizers, wholesalers-exporters, agricultural production cooperatives, wholesalers, postal traders;
- 2. Brokers and agents: Brokers, agents, manufacturers' agents, sales agents, purchasing agents, commission wholesalers;
- 3. Wholesale branches and offices of manufacturers: Sales branches and offices, purchasing offices;
- 4. Various specialized wholesalers: Wholesalers-buyers of agricultural products, wholesale oil depots, wholesaler-auctioneers.
- 1. Merchant wholesalers are independent commercial enterprises that acquire title to all goods in which they deal. In different fields of activity, merchant wholesalers are called differently: wholesale companies, distributors, supply houses. Merchant wholesalers come in two varieties: full-service and limited-service.
Full service wholesalers provide the following services:
- - storage of inventory;
- - provision of sellers;
- - lending;
- - ensuring delivery of goods and providing assistance in the field of management.
By nature, they are either wholesalers or distributors of industrial goods. Wholesalers trade primarily with retailers, providing them with a full range of services. They differ from each other mainly in the breadth of their product range.
Mixed product wholesalers handle multiple product groups to meet the needs of retailers with a broad mixed product line as well as businesses with highly specialized product lines.
Wholesalers of a narrow, rich assortment deal with one or two assortment groups of goods with a much greater depth of this assortment, for example, technical goods, medicines, and clothing.
Highly specialized wholesalers deal only with part of a particular assortment group of goods, covering it to great depth. As an example, we can point to wholesalers of medical nutrition products, spare parts for cars, and seafood. Wholesalers in this case provide their customers with a more complete choice.
Distributors of industrial goods sell products
predominantly to manufacturers rather than retailers. They provide their customers with the following services:
- - storage of inventory;
- - lending and delivery of goods.
In addition, these distributors may also handle a broad product line (in which case they are often called supply houses), a mixed product line, or a specialty product line. Distributors of industrial goods can deal with the following products:
- - materials for maintenance, repair, operation;
- - parts of main equipment - bearings, gearboxes for engines, etc.;
- - equipment - forklifts, electric vehicles, etc.
Limited-service wholesalers provide far fewer services to their suppliers and customers. There are several types of wholesale enterprises with a limited range of services. A cash-and-delivery wholesaler deals with a limited assortment of popular merchandise that he sells to small retailers for immediate payment.
Retailers themselves organize the removal of purchased goods. For example, a small seafood retailer goes to such a wholesaler in the morning, buys several boxes of products from him, pays immediately, takes the goods to his store and unloads them himself.
A wholesaler is a traveling salesman who not only sells, but also delivers the goods himself.
buyers. He deals with a limited range of products and sells them for cash, visiting shops, supermarkets, restaurants, hotels, and factory cafes.
Wholesaler - organizer works in industries that are characterized by bulk transportation of goods, such as heavy equipment, timber, coal. Such a wholesaler does not hold inventory and does not deal directly with the goods. Having received an order, he finds a manufacturer who ships the goods directly to the buyer under certain delivery conditions and a certain time. From the moment an order is accepted until delivery is completed, the organizing wholesaler assumes ownership of the goods and all associated risk. The organizing wholesaler trades at lower prices because it does not store inventory and can pass on part of the savings to its customers. Wholesalers - exporters serve grocery stores and drug retailers, offering mainly non-food products. The owners of these retail businesses do not want to order and maintain inventory of hundreds of non-food items. The wholesaler-exporter sends a van to the store, his representative organizes a display of goods in the sales area - cosmetics, medicines, books, toys. The wholesaler-exporter sets the price for the goods, monitors their quality, arranges in-store displays and keeps track of inventory. Consignment wholesalers trade on a consignment basis, that is, they retain ownership of the goods and invoice various merchants only for what consumers have purchased. Thus, export wholesalers provide the following services:
- - delivery of goods;
- - installation of racks for storing goods;
- - maintaining inventory;
- - financing.
Export wholesalers do not engage in sales promotion, as they deal with many well-advertised branded products.
Wholesaler mail merchant is engaged in sending catalogs for cosmetics, jewelry, food delicacies and other small goods to clients from the retail sector, industrial production and various institutions. The main customers of the parcel merchant wholesaler are commercial establishments located in the surrounding areas. Completed orders are sent to customers by mail, delivered by road or other means of transport.
- 2. Brokers and agents differ from merchant wholesalers in the following respects:
- - they do not take ownership of the goods and perform a limited number of functions. Their main function is to facilitate purchase and sale. For their services they receive a commission ranging from two to six percent of the sale price of the goods;
- - they usually specialize either in the type of product offered
assortment, or by the type of clients they serve.
Brokers. Their main function is to bring buyers and sellers together and help them come to an agreement. The broker is paid by the one who attracted him. The broker does not hold inventory, does not participate in the financing of transactions, and does not assume any risk. The most typical examples: food brokers, real estate brokers, insurance brokers, securities brokers.
Agents. An agent represents a buyer or seller on a longer-term basis. There are several types of agents.
Manufacturers' agents. Such agents represent the interests of two or more producers of goods that complement each other. They enter into a written formal agreement with each individual manufacturer regarding pricing policies, territorial boundaries of activity, delivery services, warranties issued for these goods and commission rates. The manufacturer's agent is well acquainted with the product range and organizes the sale of its goods, relying on his contacts with customers. The services of agents of manufacturing companies are used when selling clothing, furniture, and electrical goods. Most agents represent small businesses with a few employees who are experienced salespeople. They are hired by large firms, as well as small entrepreneurs who cannot afford to maintain their own staff of traveling salesmen. Manufacturing firms plan with the help of agents how to penetrate or be represented in new markets where the use of traveling salesmen is unprofitable.
Authorized sales agents enter into contracts with manufacturers, obtaining marketing rights for all products produced by the manufacturer. Such a manufacturer deliberately does not want to take on sales functions or feels unprepared for this activity. An authorized sales agent serves as a sales department for the manufacturer and has a significant influence on prices, terms and conditions of sale. Authorized sales agents are found in the textile industry, production of industrial equipment, chemicals, coal, and metals.
Purchasing agents usually form long-term relationships with their customers and purchase the goods they need. They receive these goods themselves, check their quality, organize warehousing and subsequent delivery to their destination. Buyers are knowledgeable and provide their clients with useful information about the market and find them the right products at the lowest possible price.
Wholesalers - commission agents - are agents who take physical possession of goods and independently conclude a transaction for their sale. They do not work on the basis of long-term agreements. Their services are most often used by companies that do not want to engage in sales. A commission wholesaler arrives in a truck with goods to the central market, sells a batch of goods at the most favorable price, deducts his commissions and expenses from the proceeds, and transfers the remaining amount to the manufacturer.
3. Wholesale branches and manufacturers' offices are the third main
a type of wholesale trade, which consists of operations carried out by sellers and buyers independently, without the involvement of wholesalers.
Sales departments and offices. Manufacturers are organizing sales departments and offices to maintain tighter control over inventory management, distribution and promotion activities.
Sales departments store inventory and are found in the forestry industry, in the production of automotive equipment and machine parts.
Sales offices do not store inventory and are found in the production of textiles and haberdashery goods.
Purchasing offices. Many retailers maintain their own buying offices in major market centers, performing functions similar to brokers, but being part of the buyer's organization.
4. Various specialized wholesalers. A number of economic sectors have their own specialized wholesale organizations.
Wholesale tank farms sell and deliver petroleum products to gas stations and businesses.
Wholesalers - buyers of agricultural products buy products from farmers, collect them in large quantities and ship them to food industry enterprises, bakeries, bakeries and buyers on behalf of government agencies.
Wholesalers - auctioneers play a large role in those industries where consumers want to inspect the goods before making a transaction. These are markets for livestock, tobacco, seafood, etc.
Wholesale trade occupies an intermediate position between industry and retail trade and actively influences the production and sale of goods to the population. The impact of wholesale trade on industry is aimed at increasing output, expanding the range, improving quality, and rhythmic delivery
goods. The main forms of influence of wholesale trade on industry are: preliminary orders, five-year agreements, wholesale fairs, supply agreements, commonwealth agreements, and the media.
Pre-orders from wholesale bases serve as the basis for industrial enterprises to develop plans for the release of goods in terms of volume and range.
A pre-order is an economically sound expression of existing and projected demand for goods.
Five-year agreements between wholesale and industrial associations are a form of long-term economic connection between industry and trade.
Such agreements provide for assortment updates, improvement appearance products, packaging of goods and other obligations ensuring full satisfaction of the needs of the population.
Wholesale fairs are held after industrial enterprises receive tasks for the production of a particular product. At fairs, wholesale trade enterprises coordinate purchases with suppliers on the range of goods, models, styles, colors, sizes.
Supply contracts between wholesale warehouses and industrial enterprises establish economic ties between them. Contracts are concluded for a year, for five years, etc. For direct long-term relationships.
Commonwealth agreements are concluded between public organizations of trade and industry enterprises. Treaties are a means to increase the efficiency of economic relations.
The media (newspapers, radio, television) are widely used by wholesalers to influence industry and consumers. Using these means, public attention is drawn to suppliers who produce low-quality goods that are not in demand among buyers.
In turn, wholesale trade actively influences retail trade enterprises, providing them with assistance in expanding the range, improving the quality of goods, increasing the share of packaged goods, organizing advanced technology for the delivery and sale of goods, and improving customer service.
Wholesale bases, together with trade departments, determine suppliers and buyers who will be in direct contact. At the same time, wholesale centers control and are responsible for the timely shipment of goods to customers.
Commodity experts at wholesale bases organize the wholesale sale of everyday goods, study demand together with retail trade, hold sales exhibitions, wholesale sales fairs, and organize advertising events.
Wholesale turnover is one of the main indicators of economic activity of wholesale enterprises. Its volume and structure characterize the degree of development of production and the level of public consumption.
Depending on the volume, structure, types and forms, the indicators of the economic and financial activities of the enterprise are determined.
There is a distinction between primary wholesale turnover - this is the sale of goods by industrial enterprises directly to retail and wholesale enterprises, and intermediary turnover - this is the sale of goods by wholesale enterprises - to retailers.
Wholesale turnover has a different economic content than revenue from sales of products in industry or retail turnover. Wholesale turnover does not reflect the production and sale of goods directly to the population for personal consumption, but characterizes the movement of goods from the sphere of production to the sphere of circulation.
Based on the size of turnover, they are distinguished: large, medium and small turnover.
Large wholesale trade turnover occurs when goods are received from enterprises in large quantities and sent to wholesale trade chains.
The average wholesale turnover is formed by wholesale enterprises that buy goods not only from industry, but also from other large wholesale enterprises.
Small wholesale trade turnover is formed at wholesale bases at grassroots wholesale enterprises.
Depending on the purpose of commodity resources, wholesale trade turnover is divided into three types: sales turnover, intra-system and inter-republican.
Wholesale sales turnover includes the sale of goods to organizations and retail enterprises located in the area of operation of the wholesale enterprise.
Intra-system wholesale trade turnover determines the mutual release of goods by wholesale enterprises into one system within one republic.
Inter-republican trade turnover covers the sale of goods outside the republic on the basis of free purchase and sale.
Thus, intra-system and inter-republican wholesale trade turnover reflect the movement of goods between wholesale trade links.
The sum of the three types of wholesale trade turnover is the gross wholesale trade turnover.
Wholesale trade turnover for each of the three types is divided into two forms:
- - warehouse (Sale of goods from warehouses of wholesale enterprises. Goods delivered to warehouses are checked, sorted, completed, etc.)
- - transit (delivery of goods by manufacturers directly to retail, wholesale, bypassing intermediate links)
Wholesale sales of goods in transit can be carried out with participation in settlements (with investment of funds) and without participation in settlements (organized turnover).
Transit turnover with participation in settlements is settled first with suppliers, and then, as a seller of goods, presents invoices for payment to buyers. At the same time, wholesale enterprises use their working capital, use bank loans, pay income tax to the budget, and receive wholesale discounts.
Transit turnover without participation in settlements involves only the intermediary activities of wholesale trade, while payments for goods are carried out directly by producers and buyers between themselves. The role of the wholesale link is limited to organizing contractual relations and supplies of goods. It participates in placing orders and drawing up specifications for goods, and monitors the progress of their shipment. In this case, wholesale enterprises do not receive wholesale discounts.
The highest, main goal of any enterprise in a market economy is to maximize profits. However, entrepreneurs, managers and business owners at a certain stage set the task of achieving an intermediate goal, ensuring break-even operation, reducing or gaining a larger market share, ensuring maximum growth in performance, etc. Each of these intermediate goals always acts as a means to achieve the main (main) goal. This approach is typical in many areas of trade, including the wholesale level. In the process of wholesale trade, enterprises solve a number of problems and evaluate them from the standpoint of achieving their goals. It is advisable to divide many such tasks into two groups: tasks related to implementation, and tasks related to the procurement of goods and services. In the conditions of market relations, firstly, it is necessary to study the sales process in terms of buyers (industrial and retail enterprises, private traders, etc.), the degree of satisfaction of their needs and assess the level of competition and what place the wholesale enterprise occupies in commodity markets, what it has plans for the coming period, etc. To do this, the company needs to use various methods of marketing research on all aspects of product markets. Secondly, it is necessary to analyze the sources of purchases (conduct marketing research on purchases), selection rules for suppliers of goods according to certain criteria, develop measures to intensify purchases (use of purchase marketing tools), conditions for one-time and ongoing purchases, concentration and dispersion of orders, study pricing policy , monitor the receipt of goods.
From the above provisions it is clear that the main thing for an enterprise is to determine the needs of wholesale buyers, establish permanent connections and find sources for purchasing goods in order to fully satisfy these needs. Dividing tasks into two groups allows for a more in-depth study of the wholesale distribution of goods and services.
In the process of trade turnover, wholesale enterprises study the following indicators:
- - dynamics of the total volume by type and product groups of wholesale trade turnover in current and comparable prices;
- - the share of wholesale trade turnover by product groups and by total volume in the commodity markets of the region;
- - the share of retail and other buyers in the total turnover and by main product groups, and assess the possibility of working with them in the future;
- - customer requests and the structure of wholesale trade turnover;
- - the ratio of wholesale and warehouse turnover to retail turnover and the distribution linkage coefficient, calculated as the ratio of gross turnover (all types of wholesale and retail) to net turnover (retail in dynamics across the area of activity of the enterprise and in comparison with indicators for the region as a whole).
For wholesale enterprises, it is necessary to have a large number of reliable sources of supply, which will allow them to better formulate their supply and increase the volume of trading activities.
Information for analyzing the procurement market can be obtained from internal sources (about suppliers with whom work is or has been carried out) and external (data on turnover statistics and retail or wholesale prices, purchasing guides, fairs, catalogs and sales brochures, etc. ). Work in this direction must be carried out continuously. Each enterprise must choose suppliers that will allow it in the best possible way achieve your goals - ensure profit, increase sales, consolidate and expand your role in commodity markets, solve existing economic and financial problems, etc.
For a wholesale enterprise, it is very important to deeply study the issues of supply of goods. It is necessary not only to evaluate the share of each supplier in the total volume of supplies, but also to constantly have information about the volumes and timing of deliveries, the quantity of goods, take into account the policies and strategies of industrial enterprises and other suppliers in pricing and use it to your advantage.
In each reporting period, wholesale enterprises must study in dynamics and in comparison with other enterprises in the same area of operation indicators by which the quality of goods supplies can be assessed.
Thus, it is important to calculate and analyze the completion rate of each contract. It is calculated as the ratio of the actual quantity of goods delivered to the volume of supplies stipulated for this period in the contract. The same indicator can also be calculated in value terms as the ratio of the actual volume of supplies to its value under the contract.
When assessing the calculated indicator, you need to keep in mind that the closer its value is to zero, the more rhythmic the supply, and vice versa, the higher this indicator, the more rhythmic the supply of goods.
When analyzing supplies and assessing their impact on trade turnover, a wholesale enterprise must take into account a number of factors related to pricing. Each enterprise must consider:
- 1) to what extent current prices can ensure the sale of goods and services;
- 2) what volume of sales of goods is possible at current prices;
- 3) what are the average costs that correspond to these sales volumes;
- 4) what is the level of profitability.
Such a pricing policy can be considered successful if it allows one to restore or improve the enterprise’s position in competitive markets for goods and services and increase the enterprise’s net profit.
In the process of analyzing trade turnover and procurement of goods and services, it is necessary to understand the marketing strategy of the enterprise and determine whether there has been penetration of goods into a new market; how the market for goods sold by the wholesale base developed; what segments of the goods market have developed in this region. It is especially necessary to analyze how the use of active measures in the field of pricing influenced the development of trade turnover and the provision of profitable work.
In practice, an enterprise has the opportunity to choose one of three standard pricing strategies:
- 1) setting prices for certain goods higher than those of competitors;
- 2) setting prices at the level of competitors;
- 3) setting prices slightly lower than competitors.
During the analysis process, the enterprise must provide evidence of the validity of the pricing strategy and calculate its impact on the final results of the wholesale enterprise - turnover volumes and profits.
The trading activities of wholesale enterprises are characterized primarily by the degree of implementation of plans and the dynamics of wholesale trade turnover. Many wholesale enterprises, along with wholesale trade, are engaged in retail sales of goods. In this regard, there is a need to determine the total (gross) turnover, including wholesale and retail sales of goods. The latter is not included in the composition of the latter, but is allocated separately for the internal supply of goods to its retail trade and industrial enterprises.
In terms of composition, wholesale trade turnover is divided into the sale of goods from warehouses and in transit with and without participation in settlements.
The composition of wholesale trade turnover is characterized by absolute and relative indicators (the amount and share of individual types of wholesale sales of goods in the total volume of trade turnover). The ratio of warehouse and transit turnover depends on market conditions, the financial and economic interests of suppliers and buyers, the level of prices and tariffs for warehouse and transit services, the degree of specialization of industrial production and retail enterprises, the conditions of their supply and settlements, the range of goods supplied, the state of material the technical base of wholesale trade and, above all, the availability of warehouse space, and most importantly, the amount of profitability of the wholesale operations carried out. The most economical is the transit sale of goods, and especially the transit sale without the participation of a wholesaler in the calculations. Transit provides wholesale enterprises with minimal distribution costs, significantly reduces the distribution of goods, speeds up the circulation time of goods, helps maintain their quality, etc. However, it is not always possible to use a transit form of sales, especially for goods of a complex assortment that require sub-sorting and transformation of the production assortment into a commercial one, which necessitates their preliminary delivery to the warehouses of wholesale enterprises. The expansion of transit is facilitated by the consolidation and specialization of retail trade enterprises, the development of container transportation, and centralized delivery of goods to the retail network and other buyers. In a market economy, when choosing a warehouse or transit form of supply of goods, a wholesale enterprise must take into account the income received, profit and profitability. The feasibility of warehouse and transit delivery of goods is studied for each buyer separately (in terms of consignments of goods and product groups). Wholesale trade turnover is also studied in the areas of sales of goods (by market and non-market funds).
The supply of goods according to the market fund includes their release to retail trade enterprises for sale to the public and public catering establishments - for the production of food and the sale of purchased goods. The market stock of goods occupies the main place in the turnover of most wholesale enterprises in the republic.
The non-market fund includes the supply of goods to light and food industry enterprises for production needs (fabrics, threads, sugar, flour, salt, etc.), the supply of workwear and special footwear, and the fund of state budgetary organizations and institutions.
The supply of goods to industrial enterprises for production needs includes the industrial processing fund and the industrial consumption fund. The industrial processing fund includes the release of goods as the main raw materials (materials) for the production of certain products (for example, the release of fabrics for sewing clothes). The industrial consumption fund includes the supply of goods to industrial enterprises for use as auxiliary materials.
The implementation of the plan and the dynamics of wholesale trade turnover are examined for each direction of wholesale sales of goods (with detail by type). First of all, they check the implementation of the plan in individual areas of implementation and study the reasons for the identified deviations. The reasons for under-delivery may be violations by suppliers of contracts for the supply of goods in terms of the total volume, range, quality and timing of their receipt, as well as transport difficulties, shortcomings in the organization of wholesale trade, warehousing, and other marketing activities. An important indicator characterizing the supply of goods by wholesale enterprises is the share of the market fund in the total volume of trade turnover. An increase in the share of the market stock of goods in the wholesale turnover usually positively characterizes the trading activities of a wholesale enterprise.
The uniformity of shipment and sale of goods in wholesale trade is no less important than in retail trade. Timely and uniform supply of goods to stores and public catering establishments ensures the successful implementation of the retail turnover plan, high rates of growth in dynamics and high-quality customer service (consumers). In cases where irregular supply of goods occurred due to the fault of suppliers (industrial enterprises, etc.), provision should be made for the creation of reserve inventories in the warehouses of the wholesale enterprise and appropriate measures should be taken against suppliers who violate supply contracts. Goods should be shipped, first of all, to the most distant customers because It is not always possible to receive it before the end of the month Money to bank accounts for goods shipped in the second half of the month.
One of the main conditions for successful implementation of the plan and high growth rates of wholesale trade turnover is proper organization. At wholesale enterprises, operational control is carried out over both the shipment and sale of goods.
Each warehouse sets plans and schedules for the delivery of goods to individual customers for a month, by ten days, and often on individual days. Based on data from invoices and other documents, the actual volumes of goods shipped per day (five days, week or decade) and on a cumulative basis from the beginning of the month are determined in special tables. Using these data, it is possible to identify deviations from the plan for the supply of goods per day (five days, ten days) and from the beginning of the month to individual recipients (by product range and by total volume of delivery) and take prompt measures to improve the supply of goods. In each warehouse, in addition, they carry out operational control over the movement of goods and the state of inventory in a comprehensive assortment, the data of which is used in everyday trade and commercial work with customers.
Based on these statements from bank accounts and documents attached to them, the wholesale enterprise quickly monitors the progress of receipt of funds for goods sold, the implementation of the plan and the dynamics of trade turnover. This information is used in the operational analysis of distribution costs, financial results, solvency of the wholesale enterprise and the development of measures to improve its economic and other activities.
The use of a computer allows you to automate the operational analysis of the shipment of goods, wholesale trade, and product distribution. With the help of computers and other modern technical means, it is possible, in particular, to quickly control how many and for what amounts commodity and settlement documents have been issued for shipped goods, to whom and how many of them have been delivered, and how promptly the goods sold are paid for.
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