Retail and Wholesale Trade
Retail trade sells goods and services directly to final consumers; wholesale trade buys in bulk from producers and sells in smaller quantities to retailers. Candidates must know the functions of the wholesaler - buying in bulk, breaking bulk, storing, grading and packing, transporting, financing (credit to retailers), providing market information and bearing risk - and the functions of the retailer - providing convenience, a wide range of goods, advice, credit, after-sales service and holding stock close to consumers.
Learn the types of retailer: independent shops, multiple chain stores, department stores, supermarkets and hypermarkets, co-operative stores, franchise outlets, market stalls, door-to-door sellers, vending machines and online retailers. Also learn the types of wholesaler: merchant wholesalers (who take ownership), agents and brokers (who do not), and cash-and-carry wholesalers. Understand self-service, branding, packaging, and the reasons why producers may bypass the wholesaler (large retailers buying direct, perishable goods, direct online sales).
Traps: examiners often ask 'who takes title to the goods?' - agents and brokers do not; merchant wholesalers do. Another trap is confusing a supermarket with a department store (a supermarket sells mainly food and household goods under one roof; a department store sells many categories in separate sections). Students also wrongly claim wholesalers are always unnecessary - they remain useful for small retailers.
Worked example. A small grocery in Freeport cannot buy 500 cases of soft drinks directly. A wholesaler buys the 500 cases, breaks them into smaller lots, delivers weekly and offers 30 days' credit. This illustrates breaking bulk, transport and financing - three wholesaler functions.