Wholesale trade can be defined as purchasing products for resale or other business purposes.
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The following characteristics can be seen in wholesale trade.

• Purchasing goods with the intention of resale
• Selling goods in bulk
• Giving trade discounts
• Storing goods in bulk
• Involvement in promotion of goods
• Conducting market research
• Transporting stocks

— The wholesale trader provides multiple services to the following parties

• To the producer
•  To the retail trader

Services provided to the producer
Examples:

• Purchasing goods in bulk
• Providing information about the market

—Services provided to the retail trader
Examples:

• Supplying goods in bulk
• Providing financial facilities
• Delivering goods to the retail store

— The agent is a person who is engaged in some activity with the authority of a certain principal

— Agents can be categorized according to the services provided by them as follows

1. A commission agent is the agent who purchases or sells goods according to his discretion
   in favour of his principals. He does all these things on behalf of his principal and gets a
   commission on them.
2. A broker is the person who arranges to meet the buyer and the seller relevant to atransaction, facilitates the transaction and obtains brokerage from both parties.
3. A factor is the agent who purchases or sells goods on behalf of the principal using his  personal name in all those transactions
4. A del credere agent takes the full responsibility for collecting all the money from the relevant debtors if a credit sale has been done on behalf of the principal. He gets del credere commission in addition to normal commission.
5. An auctioneer sells his principal’s goods to the buyers who bid the highest prices orally and openly for the relevant items. He co-ordinates these activities too. He gets auction fees for all these activities.

— A retail trader, wholesale trader and the agent play the role of intermediaries in trade.

The following are some of the advantages and disadvantages of using intermediaries
Advantages

• Facilitates distribution of goods
•  Facilitates introduction of goods
• Facilitates producer’s function
• Relevant parties can obtain market information easily.

Disadvantages

•  Possibility to cause an unnecessary scarcity of goods in the market.
•  Possibility of prices of goods rising.

According to the manager they operate retail traders can be basically classified as follows

1. Mobile retailers
2. — Fixed retailers

— Different kinds of retail traders can be shown in the following flow chart.

• Mobile trade is the sale of goods going from place to place and fixed trade is selling goods in one place.
• —Mobile trade and fixed trade can be classified as small scale and large scale.
• —The person who sells different kinds of ornamental items on a small scale using bicycles
  and carts is called a hawker
• When vegetables, fruits etc are sold on small scale in a small place prepared to keep the
  goods, it is called a stall
• When different types of goods are sold under one ownership in one building with separatesections for each type, they are called departmental stores.
• When there are branches of stores all over the country to sell the products of one producer, they are called Multiple stores.
• When goods are sold with an agreement to sell only one producer’s goods they are called chain stores. (Explain briefly the other stores included in the above diagram)

— The following are some of the new trends in present retail trade.

• Using modern management techniques.
• Maintaining relatively large scale retail stores.
• Getting required quantity of stock just in time (JIT) without stocking large stocks.
•  Computerised price index.
•  Payments through credit cards.
• Maintaining relationship networks with customers.

There is a wide range of definitions of “entrepreneurs”.

Examples:

 “An entrepreneur is one who organizes, manages and assumes the risks of a business or enterprise”

The Merrian Webster Dictionary
 “An entrepreneurs is the person who destroys the existing economic orders by introducing new products and services by creating new forms of organization or by exploring new row materials”

Joseph Schumpeter
Some reasons for being an entrepreneur are given below

• Tending to self creations

Example: • Creation of new products and services
• Parents and family members are engaged in business fields and other family members following it too.
• Social and economic background suitable for the entrepreneurs

Example: • Social background valued by the entrepreneurs

• Government incentives

By the experiences received from employment

Activities done as a hobby have been converted to a business

Example:
• Raring of wet pets
• Education and practice gained about various professions and other fields
• As a result of finding the solution to social problems
Example:
• Producing compost to reduce garbage.
• Presenting solution to the menace of flies and mosquitos.
• Construction of hearth of different types as a solution to the fuel crisis.