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.