The middleman or intermediary acts as a medium for goods or services to be offered by a supplier to a consumer. Usually the intermediary provides some additional value to the transaction which may not be possible by direct trading. In this article we will know what is Intermediary and what are the Types of Intermediaries.
What is Middleman
A middleman, or mediator, is a third party that provides mediation services between two parties, including conveying messages between principals in dispute, preventing direct contact, and preventing possible escalation of the issue. A middleman is a person or group who stores valuables in trade until they are needed, with a party to the barter or other place to take delivery and store them, or until other conditions are met. be available.
Intermediaries are individuals or companies that act as intermediaries between parties for investment deals, business deals, negotiations, insurance, etc. They are commonly known as advisors or brokers and are specialized in a specific area. They give all the necessary information about a product to the customers and also streamline the processes of the company. In other words, intermediaries are third party agents or persons between the parties for a specific transaction.
Types of Intermediaries
1. Wholesalers and Resellers
They usually buy goods in bulk from the manufacturer and resell them to retailers or other businesses. They are independent businessmen and take ownership of the products purchased from the manufacturers or producers. Some wholesalers also provide services such as order processing, storage, delivery and also participate in promotions.
2. Brokers and Agents
Both these middlemen sell products and services on commission or percentage basis. They are legally appointed to provide information about a product to customers on behalf of the manufacturer or the manufacturer, but they never take ownership of the product sold. The main function of these middlemen is to bring buyers and sellers together and make a deal. For example, an insurance or real estate agent receives a commission for their service or sale, but does not take ownership.
Retailers are intermediaries between wholesalers and customers. They buy individual goods from wholesalers and sell them in small quantities from one place to the end customers. Stay tuned on our website for question papers, sample papers, syllabus and relevant information.
Distributors are selected by manufacturers to distribute their products to wholesalers or resellers at various locations. Distributors are involved in many businesses and cover many geographic areas. Some of the services distributors provide to wholesalers are delivery, maintenance of inventory, extension of credit, etc.