Q. 5

How does the wholesaler help the manufacturer in availing the economies of scale?

Answer :

The wholesaler helps the manufacturer to avail the economies of scale in the following manner:

a. A wholesaler is a link between the manufacturer and the retailer.


b. The wholesaler collects the goods in bulk from the manufacturer and passes it on to the retailers.


c. It also takes bulk orders from the retailers and passes it on to the manufacturer's product production.


d. They provide many warehousing facilities to the manufacturer such as collection, distribution, storage, and marketing.


e. This enables the manufacturer to produce goods in a large quantity and benefit on the economies of scale.


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