Retailers make more profit than wholesalers during inflation.

[og kush420]

In my opinion, it is normal for retailers to get a larger profit margin than wholesalers, but in general, wholesalers, of course, get a lot of profit accumulatively, and I think this is in accordance with the law of the market that those who are close to the final buyer can sell at a higher price. expensive.

We will see things like this from time to time where the retailer will get a bigger profit than the wholesaler or whatever it's called. This is a form of business that is carried out, the farther the goods sold by the factory (change hands), the more valuable the merchandise will be. For example, factory A produces bread and they sell it for say $2 to the first person, the first person will sell more than $2 to the third person, and so on.

The things depend on the location of the shop - sometime the wholesalers have limited clients they sell in bulk
while the other things sold alone has different profit margin - correct that the retailer make more profit than the whole seller.

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[Fara Chan]

Not only when there is inflation, retailers will always get bigger profits than wholesalers, but what needs to be understood is that wholesalers calculate profits not from one product but as a whole, so that when combined they will also get big profits. Meanwhile, retailers gain by selling one product at a time, the pattern is the same but the profits are different.

In trade law, this method applies, meaning that wholesalers seek profit from the entire product, while retailers do use this method in seeking profit. For me it's not surprising that this happens and applies because that's the process.

[Mauser]

I noticed another phenomena in my country when it comes to large producers trying to push prices up without any boundaries. The large supermarket chains started to not give into the demands from the producers to increase the prices for consumers. For a few weeks we had no Coca Cola and other big brand names in the super market anymore. Which was a bit funny because I always thought that the big corporations had all the power, but it turns out that supermarkets that get the actual money from the consumers holds the real power. This is a quite interesting developed because at the same time the supermarket chains is increasing their own low budget brands into a lot of new segments and will happily take away the market share from the products that are not being offered anymore. So for consumers trying to save some money the only real chance was to go for the own no brand products from the supermarket. It seems that the retailers that are closest to the consumers are the ones that can decide on the prices for the consumer to pay the most, they hold all the power now.

[DrBeer]

I'll tell you the words of one of my friends
"If I sell 10 kilograms of nails, I will get some profit. Let it be $ 100 per batch. And I will have this profit quickly enough. But if I sell these 10 kilograms of nails by the piece, I will earn much more, but more slowly. I am nowhere I'm in no hurry

The only caveat is that this applies to goods of constant demand and with a long shelf life. That is why, for example, private grocery stores never buy a lot of perishable food.

[Semar Mesem]

I think a strategy that can make a retailer profitable is that he can sell in small quantities so that consumers can buy it, by retailing a lot of people can buy it and it's different from wholesalers who usually don't like people because they don't want a lot of stock, and I also prefer to buy retail for example daily needs rather than storing or being in stock.

[iamsange]

I think a strategy that can make a retailer profitable is that he can sell in small quantities so that consumers can buy it, by retailing a lot of people can buy it and it's different from wholesalers who usually don't like people because they don't want a lot of stock, and I also prefer to buy retail for example daily needs rather than storing or being in stock.

The effect of the buyer is actually not on the small amount of mate, but on the lower price. Because when the price of goods can be sold at the cheapest figure, it is certain that many buyers will approach and want to buy in large quantities. Especially if the goods purchased can be stored for a long time before being consumed or used.

And if you personally prefer to buy at a retail price for your daily needs, if you calculate it on a weekly or monthly basis, it will also be more expensive than those who buy wholesale. So it's impossible for everyone to dislike buying wholesale as long as the price can be cheaper than diluted which can be used in a day and can run out immediately, so you have to continue to provide time and money to buy the same items every day.

[bitgolden]

I'll tell you the words of one of my friends
"If I sell 10 kilograms of nails, I will get some profit. Let it be $ 100 per batch. And I will have this profit quickly enough. But if I sell these 10 kilograms of nails by the piece, I will earn much more, but more slowly. I am nowhere I'm in no hurry

The only caveat is that this applies to goods of constant demand and with a long shelf life. That is why, for example, private grocery stores never buy a lot of perishable food.

Sort of correction, they do buy perishable food in bulk, but they do not buy it right away, they just get the order in early. This means lets assume there are 100 farms that grow tomatoes, and this big grocery store like Walmart makes a deal with all 100 and tell them to give the store 10 kilograms per day for example, I am just giving an example, they pay beforehand, and they buy the rights to whatever grows and that way they do not get the food in a single day, but they get it 365 days constantly.

That's how it works, I worked in a huge grocery store chains office for a while, and that is how they did it for every product, they made contracts for bulk but they got the items piece by piece.

[Fortify]

There is a say that 'the rich gets richer and the poor gets poorer'. Retailers are making more profit than the wholesalers and manufacturer during inflation. The poor always buy from retailers because they are the final consumers, while the rich buys in bulk this means they buy directly from the wholesalers. Last week the bakery in my area closed down,due to inflation in flour price,thinking this will be the solution. There was no bread for three days. After three days,the bakery opened and everybody was happy but this time,the bread price increased with 40 naira. A pack of 6 was sold at 410 naira wholesale price,80 naira for one retail price.This shows that the retailer gets 70 naira profit after selling a pack of 6 which is 480 naira. When the bakery reopened a pack of 6 is sold at 450 naira to the retailer, the retailer now sells 100 per one,i.e 600 for the pack.The wholesaler buys from the bakery at the rate of 360 naira for a pack before shutdown and sells 410 naira, after re-open he buys at 400 to sell at 450 naira.
 

 From calculation we can see that before the bakery shuts down,the wholesaler was making a profit of 14% but after the bakery reopened he makes a profit of 12%. The retailer was making a profit of 17% before shut down but after the bakery reopened, he makes a profit of 33% which is almost double of his profit.
 Is it that as long as you are selling essential commodities, inflation doesn't affects your business instead you make more profit.

It's impossible to make such a wide and sweeping statement across all products, at least without evidence, because there are so many factors involved. We are currently in a time of massive inflation which is eating into the profit margins of producers, wholesalers and retailers. Ultimately it is producers and retailers who in most cases control the profit margins at all times because wholesalers are simply middle men who try to make money by buying in bulk amounts from suppliers. The overall state of the economy also plays a big factor because in recessions when times are tight then wholesalers often struggle to shift much stock and can be on the hook for inventory while retailers are ruthless in their pricing offer.

[og kush420]

It's impossible to make such a wide and sweeping statement across all products, at least without evidence, because there are so many factors involved. We are currently in a time of massive inflation which is eating into the profit margins of producers, wholesalers and retailers. Ultimately it is producers and retailers who in most cases control the profit margins at all times because wholesalers are simply middle men who try to make money by buying in bulk amounts from suppliers. The overall state of the economy also plays a big factor because in recessions when times are tight then wholesalers often struggle to shift much stock and can be on the hook for inventory while retailers are ruthless in their pricing offer.

i agree what you have mentioned  - here in our region the demand has reduced a lot.
And because of this -  the retailer and supplier both are in trouble! I too have stopped going to the market and other people too have stopped purchasing unnecessary stuff.

[DrBeer]

I'll tell you the words of one of my friends
"If I sell 10 kilograms of nails, I will get some profit. Let it be $100 per batch. And I will have this profit quickly enough. But if I sell these 10 kilograms of nails by the piece, I will earn much more , but more slowly.

The only caveat is that this applies to goods of constant demand and with a long shelf life. That is why, for example, private grocery stores never buy a lot of perishable food.

Sort of correction, they do buy perishable food in bulk, but they do not buy it right away, they just get the order in early. This means lets assume there are 100 farms that grow tomatoes, and this big grocery store like Walmart makes a deal with all 100 and tell them to give the store 10 kilograms per day for example, I am just giving an example, they pay beforehand, and they buy the rights to whatever grows and that way they do not get the food in a single day, but they get it 365 days constantly.

That's how it works, I worked in a huge grocery store chains office for a while, and that is how they did it for every product, they made contracts for bulk but they got the items piece by piece.

I know how large retail works - for many years I worked with retail, grocery, non-grocery. I know how a commodity matrix and planning of deliveries/purchases, including perishable goods, is formed in a grocery store. Yes, that's right, you described everything correctly. But I specifically specified that large batches of perishable products are not purchased by small private shops, which also do not have large contracts and conditions like grocery chains.

[RolonNigel]

The biggest victims are the unemployed and the urban residents who rely on the urban subsistence allowances to make ends meet.

The rich use the large amount of funds in their hands to purchase value-preserving and value-added commodities, obtain high value-added profits from them, and become richer.


Issuing a large amount of currency and creating inflation is the most convenient way for the country to plunder social wealth.

[Gyfts]

Not quite. Here you enter into a semi-vicious circle, because the materials that merchants raise their price as a result of inflation will also have to buy them at a higher price again when the quantity runs out, so practically the real capital value has decreased, because for example the capital that was It equals 100 pieces of the commodity for example before the price has been raised, it will be able to buy only 75 pieces after the price has been raised.

So practically it can be said that inflation is a loss for both the merchant and the buyer.

If the wholesalers increase their prices, then so do the retailers. The consumers always pay elevated prices for goods so it isn't the retailers that are necessarily effected.

If sales volume decreases as a result of inflation because consumers are unwilling to pay the higher prices, then that's a different story. Most of the inflation you're seeing now is money printing. Demand was artificially increased because of how much money was circulating in the economy so both wholesalers and retailers raised their prices once they couldn't meet demand.

[Fatunad]

Not quite. Here you enter into a semi-vicious circle, because the materials that merchants raise their price as a result of inflation will also have to buy them at a higher price again when the quantity runs out, so practically the real capital value has decreased, because for example the capital that was It equals 100 pieces of the commodity for example before the price has been raised, it will be able to buy only 75 pieces after the price has been raised.

So practically it can be said that inflation is a loss for both the merchant and the buyer.

If the wholesalers increase their prices, then so do the retailers. The consumers always pay elevated prices for goods so it isn't the retailers that are necessarily effected.

If sales volume decreases as a result of inflation because consumers are unwilling to pay the higher prices, then that's a different story. Most of the inflation you're seeing now is money printing. Demand was artificially increased because of how much money was circulating in the economy so both wholesalers and retailers raised their prices once they couldn't meet demand.

Retailers could really just easily adjust basing up on what they had purchased on those wholesalers and its true that the burden would really be passed up to us consumers on which leaving no choice but to deal
up with those mark up prices.If we do speak about retailers making more money or profit then its none of wholesalers business.We do have our own way on setting up prices and if those retailers do really
make some slight higher in profit margin then it is of course depending into their own preference and consideration. People or consumers are the ones who would really be having to look
which one would really be cheaper in between retailers.