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Who is the best choice for your business partner? Distributor vs Wholesaler
publisherzhang
time2024/05/05
- In the apparel industry, distributors and wholesalers each play a key role. Distributors act as a bridge between manufacturers and customers, focusing on service terminals and inventory management, while wholesalers focus on high-volume trading and the pursuit of profit maximisation. Each has its own characteristics in terms of role positioning and business strategies, and is an integral part of the apparel supply chain.
Who is the best choice for your business partner? Distributor vs Wholesaler
What is a Clothing Distributor？
Apparel distributors are commercial organisations that sell apparel products to consumers in their distribution area. They are not only responsible for selling the manufacturer's products, but also for conducting marketing activities, investing part of their capital in stocking goods, after-sales service, logistics and other sales-related expenses. In addition, distributors are also responsible for collecting and analysing feedback from customers and market information, and providing timely feedback to manufacturers to assist them in optimising product design and marketing strategies. Different distributors may adopt different distribution models, such as direct and indirect sales, to meet market demand.
What is a Clothing Wholesaler？
An apparel wholesaler is a business organisation that specialises in wholesale apparel business and sells large quantities of apparel products to retailers or other business customers. They usually establish long-term and stable relationships with apparel producers or manufacturers to buy goods at lower prices and sell them to downstream retailers at wholesale prices. Apparel wholesalers play an important role in the supply chain by not only providing retailers with a diverse selection of products, but also helping manufacturers to reduce inventory costs and increase market coverage through bulk purchasing and distribution.
What is the difference between a clothing distributor and a clothing wholesaler?
1. Merchandise procurement and inventory:
Apparel Distributors: Distributors are more flexible in merchandise sourcing, usually ordering merchandise based on market demand and customer needs, and do not hold large quantities of stock. They have the ability to hold stock for a long period of time and will adjust their inventory levels according to sales and market demand.
Clothing wholesalers: Wholesalers are more fixed in their purchasing of goods, and usually purchase goods according to their own inventory and sales plans. They have a closer relationship with manufacturers and have a more stable channel of purchase. Due to the large number of transactions, wholesalers usually need to take up a large amount of capital to support inventory.
2. Operation strategy:
Apparel Distributors: Distributors focus more on service terminals and customer relationship maintenance. They win consumers' trust and loyalty by providing professional shopping experience and after-sales service. Distributors usually sell through multiple channels, such as brick-and-mortar shops and e-commerce platforms, to meet the needs of different consumers.
Clothing wholesalers: Wholesalers, on the other hand, focus more on co-operation with producers or manufacturers, pursuing cost control and source stability. Their operation strategy is mainly based on market demand and price changes to adjust their own purchase and sales plan, the pursuit of profit maximisation.
3. Affiliation:
Clothing distributors: distributors are usually appointed by manufacturers and are somewhat similar in nature to agents. Manufacturers rely heavily on distributors for their shipments, so distributors occupy a more important position in the sales channel.
Clothing wholesalers: Wholesalers have no specific affiliation, as long as they have money to buy goods, they can engage in wholesale business. Their business strategy is mainly based on market demand and price changes to adjust their own purchase and sales plan.
What are the respective customer demographics of apparel distributors and apparel wholesalers?
Clothing distributors' customer groups mainly include: retailers, self-employed people and end consumers. Retailers and self-employed people may choose distributors as their suppliers because distributors can provide a diverse selection of products, a professional shopping experience and after-sales service to help them meet consumers' needs. End-consumers, on the other hand, may choose to buy apparel directly from distributors because they like the brands, styles or services offered by distributors.
Client demographics of apparel wholesalers, on the other hand, are mainly: retailers, wholesalers and commercial clients such as e-commerce platforms. These customers usually need to purchase goods in large quantities to meet their sales needs. Wholesalers are able to provide them with stable sources of goods, lower prices and flexible purchasing methods, thus becoming their preferred suppliers.
In terms of the needs of the customer population, customers of apparel distributors pay more attention to product style, quality and after-sales service as they need to win consumers' trust and loyalty by providing quality products and services. Clients of apparel wholesalers, on the other hand, pay more attention to the stability of supply, price advantage and ease of procurement to meet their business operation needs.
In short, the customer demographics of apparel distributors and apparel wholesalers overlap to a certain extent, but there are also differences. Distributors focus more on interaction with consumers and services, while wholesalers focus more on co-operation with business customers and stability of sourcing.
Pros and Cons of Clothing Distributors and Clothing Wholesalers
Pros and cons of apparel distributors:
Pros:
1、Flexibility: distributors usually have the flexibility to order merchandise based on market demand and customer needs without the need for a large backlog.
2、Diversified product choices: distributors usually work with multiple brands and manufacturers, and are able to offer different styles and price ranges of apparel to meet the needs of a variety of retailers.
3、 Professional sales support: Distributors usually have professional sales teams that can provide sales support and consulting services to help retailers increase sales.
4、Expanding sales channels: distributors' sales ability and channel resources can help brands quickly enter new markets and expand sales.
Disadvantages:
1、Low profit: Since distributors need to share with co-operative producers, the profit to distributors is relatively small.
2、Difficult to manage: It is difficult for the brand to control the sales behaviour and sales quality of the distributor, and it is easy for the sales channel to be unregulated and the brand image to be out of control.
Advantages and disadvantages of clothing wholesalers:
Advantages:
1、 Cost control: wholesalers and producers or manufacturers to establish a long-term stable relationship, can buy goods at a lower price, and through a large number of purchases to reduce costs.
2、Stable source of goods: the relationship between wholesalers and manufacturers is close, the purchase channel is more stable, and can ensure the supply of goods.
3、High economic efficiency: although the wholesaler has the risk of hoarding goods that can not be sold, but the overall profit per commodity is higher.
Disadvantages:
1、large capital consumption: due to the large number of wholesalers' transactions, they usually need to take up a large amount of money to support the inventory.
2、Intense price competition: wholesalers face intense market competition and need to compete on price, which may reduce profit margins.
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