DECADECA Travel and Tourism Practice Exam

What is a primary function of a wholesaler?

1. To manufacture goods

2. To promote directly to consumers

3. To distribute products to retailers

4. To set retail prices

The correct answer is: To distribute products to retailers

A primary function of a wholesaler is to distribute products to retailers. Wholesalers act as intermediaries in the supply chain, purchasing large quantities of goods from manufacturers and selling them to retailers in smaller quantities. This role is crucial in the retail ecosystem as it allows retailers to obtain products without having to deal directly with multiple manufacturers, simplifying the purchasing process and helping retailers manage inventory more effectively. In contrast, manufacturers are responsible for producing goods, while promoting directly to consumers typically falls under the responsibilities of retailers or direct marketing firms. Setting retail prices is generally determined by retailers based on various factors, including costs, competition, and market demand, rather than by wholesalers. Through their distribution role, wholesalers help ensure that products are available at the retail level, contributing to the overall efficiency of the supply chain.