Thus it is clear that the predominant organization , particularly in the distribution of manufactured goods , is the wholesale merchant who carries stocks .sx In some trades- e.g. , hardware- he is known as a factor .sx Besides owning and warehousing the goods , the wholesaler may process them in some way .sx This is chiefly the case with agricultural products .sx A tea merchant blends and packets tea ; a seeds merchant cleans and sorts seeds obtained from growers .sx Not all intermediaries ( whether merchants or agents ) actually handle the merchandise in which they deal ; they may merely provide a link between a source of supply and the demand for it .sx The performance of the wholesale merchant's true functions ( which may include such services to retailers as communications , selection , stockholding , credit facilities , and transportation ) requires a heavy capital outlay .sx Only by operating on a large scale can the large overhead costs be absorbed in the turnover , so as to produce a reasonable net profit .sx Consequently it is not surprising that the 1950 Census showed that over four-fifths of the trade of merchants was handled by wholesalers each with an annual turnover of over +100,000 .sx Though in discussing wholesalers we generally assume that the function will be carried out by a single firm , this need not be so .sx The task may be split up between two or even more intermediaries .sx In some trades , particularly horticultural products and fish , a system of primary and secondary wholesalers often exists .sx The former is essentially a collecting organization , though he may also process , grade , or pack before reselling in bulk to the secondary wholesaler , who performs all the other services normally associated with wholesaling .sx It is convenient to classify wholesale merchants , according to the extent of the sales territory covered by the business .sx Thus many of the larger firms are national wholesalers , distributing goods to every part of the country .sx They carry large stocks , and often have their own brands , and operate a comprehensive delivery service over a wide area .sx A second class covers only specific parts or regions of the country- perhaps Northern England or Scotland .sx The local wholesaler confines his custom to a much smaller area- often a radius of a few miles from his warehouse .sx The local and regional wholesalers usually offer a more restricted service as compared with the national wholesaler .sx Some wholesalers have a number of branches or stock-rooms up and down the country .sx General and Specialist Wholesalers .sx Wholesalers may also be classified according to the range of stock carried .sx Though generally they specialize in one group of commodities , there is considerable variation in the extent of this specialization .sx Perhaps the most important section of the wholesale trade , both in terms of numbers of firms and turnover , is that of the general wholesalers .sx They are analogous to department stores , as there are a number of departments ( frequently twenty to twenty-five ) selling a wide range of rather unrelated commodities , with an extensive choice within each commodity group .sx Such firms may employ five hundred or more 'inside staff' and up to one hundred travellers .sx Most general wholesalers occupy large buildings in the central areas of cities , and also normally have branches or stock-rooms strategically situated in other large towns .sx The main attraction of the general wholesaler is , of course , the ability to bring together for the convenience of the retailer a wide range of merchandise under one roof .sx For a number of years the general house has tended to concentrate attention on a related group of commodities .sx When this specialization is carried a stage farther the wholesaler becomes a specialist house .sx The term , in fact , may imply anything from a wholesaler carrying one commodity group to one with several hundred , the emphasis being on the similarity of commodities rather than on their number .sx The specialist house is usually of moderate size- in the textile trade , for example , having five or six departments .sx Millinery , piece-goods , lace , and children's wear seem particularly suited for this treatment , and in extreme cases specialists deal in only a few articles , particularly if they become sole distributing agents .sx The development of the specialist is partly the result of manufacturer pressure for more concentrated selling , and partly through his ability to become an authority on quality and value in his particular line of business .sx Cash-and-carry Wholesalers .sx This form eliminates a number of operations traditionally associated with wholesaling in return for lower prices .sx There are no credit facilities or delivery services available , and there is rarely any outside selling .sx Such wholesalers are chiefly found in sections of the food trade , household goods , toys , and 'market lines' ( very cheap merchandise for street markets)- wherever a commodity has a high rate of stock-turn potential .sx Cash-and-carry wholesalers are likely to increase in number .sx Agents , Brokers , and Other Small Wholesalers .sx There are many small firms , trading under various titles , which , though they may acquire title to the goods they sell , either never actually hold them or , if they do so , only transfer them without further processing or servicing .sx In the building trade such a trader is picturesquely described as a 'brass plate' merchant , and a similar type of intermediary appears in the clothing trade , where he sometimes acts as a speculator entering and leaving the trade according to the market .sx The commission merchant , as he is sometimes called , operates without stock ( and frequently on credit ) , selling entirely from manufacturers' samples and placing orders only sufficient to cover his sales .sx On the other hand , the manufacturer's agent carries out functions similar to those of the wholesaler's representative , but , unlike the latter , he is self-employed , and is remunerated by a service fee , or , more usually , by a percentage commission on all sales made .sx The agent is usually given the sole rights in his particular area .sx Agents are primarily used in selling to wholesalers or to central offices of chains of shops .sx They enable a manufacturer to be permanently represented in these areas by people familiar with business conditions there , and they save him the expense of establishing branches .sx Co-operative Wholesaling .sx By far the largest units in the wholesale trade are the Co-operative wholesalers .sx There are two main Societies , for England and Scotland respectively , and they exist to serve the many retail Co-operatives , which provide nearly all the capital and exercise control .sx In return the local Societies receive dividends on their purchases .sx The Co-operative Wholesale Society , with headquarters in Manchester and four big branch depots , has been in existence for nearly a century .sx The Scottish 'Wholesale' was formed shortly after .sx These two Societies have established their own factories , producing goods in 1957 worth just over +160 m. , chiefly for producing foodstuffs and household goods .sx The C.W.S. owns ships , farms , and plantations , transacts considerable banking business , and shares with its Scottish counterpart the control of the Co-operative Insurance Society .sx The two Societies also own and control the English and Scottish Joint C.W.S.. , which performs the special services of tea- and coffee-blending and cocoa and chocolate production for them .sx In 1938 one-tenth of all Britain's imports of food reached housewives by way of the C.W.S. , and more than half of the goods was purchased direct from the overseas markets by the buying organization of the Society , which has depots in many countries .sx The C.W.S. is controlled by an elected Board of Directors of twenty-eight , seven of whom retire annually .sx All are full-time salaried officials .sx The Board meets weekly in Manchester , London , or Newcastle .sx It is one of Britain's biggest businesses , since over three-fifths of the goods sold by retail Societies are obtained through the C.W.S. , and its turnover in 1957 amounted to about +454 m. Wholesaling and Integration .sx One of the most important trends in distribution in the twentieth century has been the increasing desire of manufacturers to control the wholesaling functions themselves .sx This they have usually achieved by establishing their own wholesale department and depots where necessary , though occasionally they have acquired existing wholesale organizations .sx Some wholesalers seeking to maintain their traditional position have adopted the defensive policy of integrating with certain manufacturers .sx Such vertical expansion has been made chiefly to direct and maintain the supply of the most profitable lines within the framework of the organization .sx On the other hand , the large retailer , particularly if he has many outlets , may decide to engage in wholesaling ; in fact , many of the present large wholesale houses had their beginnings as retailers .sx The wholesale warehouse is then often operated as an ancillary concern ( generally a subsidiary company ) , perhaps under a different name .sx An existing wholesaler may be taken over .sx Some large groups , such as Debenhams , and the Great Universal Stores , have several wholesale subsidiaries .sx In a few trades , such as fruit and tobacco , firms buy merchandise in bulk for their own shops and resell what they do not need to smaller shops in the district .sx In such circumstances they are primarily retailers , and a few use the terms 'wholesale' or 'warehouse' as a customer-catching device .sx While wholesalers are generally prepared to make direct sales to certain classes of final customer- e.g. , schools and large industrial firms- some have established a special department to sell direct to the public on certain conditions , such as after a proper introduction by a retailer .sx Other wholesalers have expanded forward into retailing by the requisition of shops to meet the threats of a changed pattern of distribution and perhaps to make a double profit on each transaction .sx This policy has aroused considerable rancour , even when the shop takes only part of its merchandise from the parent , and has weakened wholesale-retail co-operation .sx Location of Warehouses .sx The distinctive premises of the wholesaler are , of course , the warehouse , since normally large stocks must be carried .sx The premises are generally utilized in a strictly practical manner , since the wholesaler's appeal is to the businessman .sx A wholesale merchant's business cannot be set up anywhere ; his warehouse is of most service to his customers if they can reach it easily and quickly .sx Consequently it is usually established in a city which is the commercial centre for the surrounding district .sx London is the biggest centre of wholesale textile distribution , with Manchester not far behind .sx In a large city it is usual to find those of one trade located in a particular quarter or street , particularly if there is a market or exchange near by .sx Thus in London , Mark Lane is the centre for corn merchants , while in Manchester all the big textile houses are found in the environs of Piccadilly .sx This concentration of trades of each class is convenient both to customers and to manufacturers' salesmen .sx Organization .sx Though a few small businesses , particularly those specializing in certain kinds of business- e.g. , millinery , trimmings- are run by single traders , and the partnership is still fairly frequently met with , the most general form of proprietorship is that of a limited company .sx This is mainly on account of the heavy capital requirements of the trade .sx Wholesale directors are almost invariably executive or working directors , with full responsibility for a particular function .sx The scope of the wholesaling task is indicated by a few facts about wholesale textile distribution .sx Large wholesalers carry an average stock of +1,000,000 ; they dispatch approximately 2000 parcels a day to various parts of the country for their 10,000-15,000 retail accounts , and receive supplies from anything up to a thousand suppliers from time to time .sx Moreover , the documentation and handling of each customer's order may involve thirty-two separate operations , many of which must be repeated in reverse if the goods do not comply with the retailer's requirements .sx Whatever the merchandise carried , the organization broadly resembles that of a big department store , each department forming a separate unit under a departmental manager .sx Frequently there are four main departments :sx buying , warehousing , selling , and administration .sx There are usually separate buyers responsible for the requirements of each section , but their activities are co-ordinated by the purchasing department , which also deals with the paper-work .sx Warehousing is a specialized job , and may include assembling , grading , breaking bulk , and packing .sx The wholesaler provides a selling organization for the manufacturer , and most of this selling is done by trained travellers .sx But the wholesaler's showrooms may also be very important :sx the retailer is offered a huge stock and variety of merchandise which no other system could bring to him under one roof .sx