discuss the various arguments in favour and against elimination of wholesaler from the channels of distribution
Answers
Answer:
Arguments in favour of elimination of wholesalers are as follows. 1) Wholesalers increase the prices of products by adding their margins and marketing costs in the final prices of products. 2) They make the distribution process slow by acting as a middlemen between producer and consumer.
Explanation:
PLEASE MAKE ME A BRAIN LIST
Answer:
Arguments in Favour of Elimination of Wholesalers:
1. Wholesalers are middlemen between the manufacturers and the retailers. They increase the cost of marketing and price of the products goes up. The consumers have to pay higher price. By eliminating wholesalers, prices of the products will decrease and the consumer shall benefit. The manufacturers will be earning more profit on account of lesser prices of the products.
2. Big and established retailers such as large departmental stores can afford to make their own purchases directly from the manufacturers without approaching the wholesaler. The wholesalers are easily eliminated.
3. On account of developed means of transportation, the retailers can easily purchase goods directly from the manufacturers without the services of wholesalers.
4. Now-a-days, the manufacturers have started opening their own shops for the distribution of their products. They are establishing direct link with the consumers. The services of the wholesalers can be easily dispensed with.
5. The co-operative movement is gaining immense popularity these days in India. Various co-operative stores and super markets are operating for selling goods to the consumers. They procure their supplies directly from the manufacturers. The presence of the wholesalers is superfluous in the chain of distribution.
6. In order to earn more profits, the wholesalers may take over the products of the manufacturer’s competitors. The manufacturer concerned may face the sudden decline in the sales of his products.