Question

1.What is the difference between a wholesaler and a retailer?

2.Whose cost is COGS listed at, the customer’s price or the seller’s price?

3.Why would a business offer a purchase discount?

Answer 1

1.Wholesaler means selling goods in large quantities.

Retailer means selling goods in small quantities.

Difference between wholesaler and retailer ----

Wholesaler	Retailer
They purchase goods from manufacturers and sell to retailers .	They purchase goods from wholesaler and sell goods to customers.
They sell particular product.	the sell different types of products.
They sell goods generally on credit to retailers because they purchase huge quantity.	They preferably sell goods on cash.
They buy huge quantity of products from manufacturers and sell in small quantities to retailers	they bought small quantity and sell in smaller quantity to customers.
They don't sell goods to actual user directly.	They sell goods directly to its actual user.
They need huge capital to start business.	they don't need huge capital.
The display of goods not much needed for wholesaler.	they need to attract their customers by doing decoration and display of goods
they need godown to store goods.	they need shops to sell goods.
They don't provide after sale services.	they need to provide after sales services.
They don't need to make very healthy relationship with customers.	they need to make very good relationship with their customers.

2.Wholesaler COGS listed at seller's price. In seller's price includes price he paid to manufacture and his profit margin.

Retailer COGS listed at customer 's price. In customer 's price they include price they sell from wholesaler and profit margin, services cost they provide post sales, taxes,shipping charges etc.

3.A business offer purchase discount because of many reasons---

1.To increase sales.

2.To attract more and more customers.

3.To build goodwill in market.

4.To achieve own sales goals.

5.To defeat competitors.

6.To make space for new goods. example -clearance sales to clear old stock.