Services of Retailers to Manufacturers, Wholesalers and Consumers

7. Services of Retailers to Manufacturers, Wholesalers and Consumers

A retailer stands at the very end of the distribution chain and, precisely because of that position, performs genuine services in BOTH directions — back up the chain, to the manufacturer and wholesaler who supply them, and forward, to the individual consumer who is their actual customer.

Services of a retailer to manufacturers and wholesalers:

1. Distributes goods over the whole consuming public — a manufacturer or wholesaler could never economically reach every individual household directly; retailers, spread across every locality, perform exactly this last-mile distribution on their behalf.
2. Provides genuine market feedback — being in direct, daily contact with actual consumers, a retailer is best placed of anyone in the chain to relay real consumer likes, dislikes and complaints back up the chain.
3. Actively promotes sales — through window displays, product arrangement, and direct, personal persuasion at the point of sale, a retailer often does more to actually convert a browsing customer into a buyer than any advertisement upstream could.
4. Shares the risk of holding stock — once a retailer has bought stock from the wholesaler, the risk of that stock's price falling, spoiling, or going out of fashion before it sells shifts onto the retailer.

Services of a retailer to consumers:

1. Convenience of place and time — a retail shop, sited close to where consumers live and open at hours that suit them, saves the individual consumer the trouble of travelling to a distant wholesaler or factory.
2. Convenience of quantity — breaks bulk down to the small unit — a single packet, a single piece — that an individual household actually needs, at a price the household can actually afford to pay in one go.
3. Variety and choice — particularly at a general store, departmental store or supermarket, a consumer can compare several brands or qualities of the same product side by side before buying.
4. Guidance in buying — a retailer, especially at a speciality store, can genuinely advise a consumer on which product best suits their specific need.
5. Credit and other facilities — many retailers, particularly small fixed-shop retailers dealing with known regular customers, extend credit; larger formats often add home delivery, after-sales service, or instalment facilities.
6. Saves the consumer's own time and effort — by performing the whole job of assembling a wide range of goods from many different sources in advance, a retailer spares each individual consumer from having to deal separately with every wholesaler or manufacturer whose product they want. …