Wholesaling

What is 'Wholesaling'

The sale and distribution of goods to users other than end consumers. Wholesaling involves selling merchandise to retailers, wholesalers and merchants, or to industrial, commercial and institutional users. A wholesaler can act as a middleman, brokering deals between these businesses. Wholesaling often occurs when large quantities of merchandise are reassembled, sorted, then repackage, and distribute in smaller lots.


In banking, the term wholesaling refers to services that are designed for large, institutional clients, including real estate developers, pension funds and large corporations, as opposed to retail banking which provides services to standard, individual customers. A wholesaler can also be a sponsor of a mutual fund, or act as an underwriter in a new issue.

BREAKING DOWN 'Wholesaling'

Wholesaling is one step on the supply chain, which includes various companies like suppliers, manufacturers and retailers. Retailers and other users purchase goods from wholesalers, and then sell the products at a higher price to cover costs and generate profits. Supply chain management (SCM) was developed in the 1980s to address the need to maximize efficiency in the business processes involved in moving goods from original suppliers to end users.

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RELATED FAQS
  1. What is the goal of real estate wholesaling?

    Invest in real estate with minimal capital through wholesaling. There is no remodeling or carrying costs. Rather, a quick ... Read Answer >>
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    Learn about the standard debt-to-equity ratios in the wholesale sector, and discover some of the many subindustries in the ... Read Answer >>
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  4. What is the average annual dividend yield of companies in the wholesale sector?

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  5. What metrics can be used to evaluate companies in the wholesale sector?

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