Wholesalers and retailers are important part of distribution channel in every sector. Wholesalers and Retailers are interconnected and dependent at each other for their requirements. To differentiate between these two, first we have to understand about both of them:
Wholesalers: Wholesalers are the dealers or his agents who deals in supplying products to retailers, pharmacies, chemists, hospitals, institutions, dispensaries medical, education and research institutions or related dealers. They work at wholesale basis (Business to Business Type). Wholesalers don’t sell products directly to consumers. For pharmaceutical sector wholesale business, one must have wholesale drug license Number
Retailers: Retailers are the dealers or his agents who are engaged in selling goods to patients and Doctors. They work at retail basis (Business to Customer Type). For Pharmaceutical Retail business (Also known as Chemist/Druggist/Pharmacy), one must have Retail/Pharmacy/Chemist Drug License Number
Difference Between Wholesaler and Retailers:
- Wholesalers deals with retailers, pharmacies, chemists, hospitals, institutions, dispensaries whereas Retailers deals with Patients and Doctors.
- Wholesaler should have wholesale drug license whereas Retailer should have retail drug license number.
- Wholesaler purchase goods from direct company or Cnf whereas Retailer purchase goods from the wholesalers.
- Profit margin of wholesalers are 8% to 12% whereas Retailers margin vary from 16% to 24%.
- Wholesaler shop’s location doesn’t affect its sale whereas Retailer shop should be prime location for good sale.
- Wholesaler deals in bulk quantity whereas Retailer deals in small quantity.
- Pharmacist is not necessary to get Wholesale Drug License where Pharmacist is compulsory for Retail Drug License.
- Wholesaler can’t sell medicines directly to patients whereas Retailers can’t sell medicines at business to business basis.
- Wholesale Business could be managed at part time basis where as permanent sitting is required for pharmacy retail success.
- Area covered by wholesalers/Distributors are large whereas retailers can sell only in its surrounding.
- Doctor’s Prescription is not necessary for selling at wholesale basis whereas Doctor’s prescription is compulsory to sell medicines to patients.
- Working hours for wholesale business is flexible whereas retail business requires strict working hours
- Wholesaler sell at Price to Retailer basis whereas Retailers sell at Maximum Retail Price Basis
- Wholesaler can supply products to hospitals and institutions whereas Retailers can’t supply products to hospitals or institutions.
- GST registration required for Wholesaler as it deal inter state where as retail don’t need GST registration if its turnover less than 40 lakh.
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