Distributors are an important element in the supply chain of products. Apparently, they are serving producers and end-users only. But they are the backbone of the economy. Yes! Today we are going to talk about the role of distributors in today’s economy. Let’s start the topic with a short introduction to distributors and Wholesale Marketplace.
Who are the Distributors?
The distributors are the person or Wholesale Marketplace that are buying products from the factories or producers and then sell them to other businesses or retailers. They are responsible for the supply of goods over the world. Distributors can be divided into many types according to the size and areas of dealing. Like direct, indirect, national, regional, etc. are the common types.
Today’s Economy
Well, the USA is the superpower. COVID-19 not only affected the economy of the USA but also affected other countries in the whole world. The second quarter of 2020 was worse as the economy faced a decline of 38%. Unemployment reached a high level of 26 million. All extra Wholesale Marketplace were closed to save people’s lives.
But there is an expectation that in 2021 the evil effects of the pandemic will be shed off. Then the economy is going to face a high rate of growth. The producers, consumers, and distributors will come to the normal track. Although the economy is facing a critical situation, suppliers are still serving the country with basic needs.
Basic Function of Distributors and Wholesale Business in the Economy.
Following are the basic functions of distributors in an economy.
1. A Bridge Between the Manufacturer and Customers
The companies are making products in huge volumes but the end consumers do not need them in large quantities. In such a situation, producers do not want to sell their products piece by piece. On the other hand, customers cannot buy quantities. The distributor facilitates both of them. They buy in huge amounts and then sell according to the requirements of customers. So, distributors act as a bridge between these two parties.
2. Reduce the Expenses of Both Parties
Distributors eliminate many expenses of the producers. For example, they don’t have to pack the products and the most important is storing. They don’t have to spend a big amount on the hiring place, maintenance, and tracking the stock. In this way, they need less investment. On the other hand, consumers don’t need to travel or bear the expenses of shipment. They easily buy goods from the distributors.
3. Risk Management for Wholesale Marketplace
Distributors are responsible to sell the products. For this purpose, they plan different marketing strategies. Despite all these efforts, products don’t sell. There are a number of reasons for it like the sudden change in the taste and desire of the customer.
Whatever the reason is the loss will be divided into the producers and distributors.
4. Circulate the Wholesale Marketplace Information
Suppliers are the main party in the trade process. They control the transfer of important data in the industry. Distributors help the producers by foreseeing reports of future demand. It helps producers make goods according to demand. They provide essential data of the market like the methods of producers and fashion trends.
5. Reduce the Complexity of the Supply Chain.
The suppliers reduce the problems of the supply of goods in the whole country. With the help of retailers, they ensure the availability of goods to every corner of the country.
They provide a credit facility to retailers. So, the distribution process will not face any hurdle.
Concluding Lines
The above points have cleared the role of distributors in an economy. Though the economy has to face a critical situation due to the COVID-19 pandemic, yet distributors create new modes of trades. Online trade is fast increasing in recent years but this pandemic will totally change the way of dealing. People are choosing online Wholesale Marketplace to shop. The distributors are vital in the economy but they also need to go for online trends to save their status in the economy.
