HG Merchants

Company Description

To be profitable, wholesale distribution must operate on a local or regional level. The most successful distributors, therefore, have either located their warehouse near a targeted metropolitan area or have set up a system of branch warehouses to limit the distance their truck fleets must travel to deliver goods to retailers.As of 1991, there was a variety of wholesale distributors in the United States. The specialty wholesaler provides a limited range of products--gourmet foods, spices, candy, or greeting cards. These wholesalers usually provide a range of services that include point-of-sale merchandising material, display suggestions, and product servicing such as stock rotation and monitoring of product displays. Rack jobbers provide a limited line of products--usually health and beauty aids, house wares, toys, and other types of non-food merchandise with distinctive marketing requirements different from those needed general goods--for which they assume complete responsibility on the in-store level.Full-service wholesalers offer complete lines of a wide range of products; they also often provide lines of general merchandise, dairy, bakery, frozen foods, fresh meat, and fresh produce. Besides these products themselves, full-service wholesalers provide help to the retailer in advertising, merchandising, and procuring products they may not warehouse. For example, a wholesaler may not actually stock ceramics in its own warehouse, yet it may help retailers in obtaining and marketing ceramic products. Among the range of merchandising services a full-service wholesaler may provide its retail customers are retail accounting; site selection; store design and interior layout; personnel training; display; promotion; advertising; suggested retail selling prices; and advisory help in projecting and controlling sales, gross margin, expenses, and net profit. In some instances, a full-service wholesaler may make private or controlled brands available to its retail customers.The retailer-owned wholesaler reflects the efforts of a number of retailers to join forces (sometimes under a common name) to operate their own warehouses and shipping lines. The cooperative effort makes it possible for retailers to obtain merchandise at the lowest possible cost. In addition to providing lines of food products, the retailer-owned wholesaler also supplies group advertising, merchandising, and other services. Among the largest retailer-owned wholesalers are the Wakefern Corporation of New Jersey and Certified Products of California Ltd.