Is it more profitable to deal directly with the manufacturers for wholesale supplies?

June 4, 2020

Choosing the right wholesale product sourcing decides the fate of a retail business. It is important to examine different procurement modes and then deciding the best one from them. Buying channels can be classified into different classes, like directly from the manufacturers, from distributors or from wholesale suppliers.

Each mode has its particular pros and cons but it depends upon your specific needs as to which method is more preferable and profitable for your business. The task of choosing the right source can get easier if you have a complete list of your needs and requirements. End customers need constant supply of quality products and that too at the right prices. Deciding the right supplier is necessary for all business involved in this supply chain.

There can be huge difference in prices of the products of same quality and the difference lies in the fact that businesses are getting their products from different sources. The one selling at low price obviously has got the products at low prices, while the one selling at higher price must be buying at high prices from suppliers.

Not all procurement methods are suitable for a wholesale business, and there s no single type of supplier that we can recommend as the best available option. The buyer determines the specific mode depending upon the size of wholesale business and available procurement channels. However, getting the products directly from the manufacturers can be the most low cost option.

Getting wholesale products directly from small sized manufacturers or producers is often a profitable deal because they will sell at amazingly low prices. Their operating costs are less and because there is no middle man involved, which means they can sell at relatively lower prices. Manufacturers will prefer to sell directly to customers because they don t have to pay commission to some distributor or wholesaler to do the selling for them.

When you are buying from a middleman or broker, they will surely charge for providing its logistics services and it will make the wholesale products more expensive. The more the people involved in this process, the more higher the price will get. Also when you are dealing with the manufacturers, you can ask for specific changes or customization in the products which can be a great competitive advantage.

These all are just some of the points to highlight the benefits of dealing directly with the manufacturers, however you may have to arrange for the shipment or delivery yourself.

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