What Are the Three Types of Wholesale?

Posted by Stylebuy

On July 7, 2025

If you’re running a small business and thinking about how to get your products or expand your reach, the world of wholesale can seem overwhelming. But don’t worry—once you understand the three main types of wholesale, you’ll be able to make smarter choices for your business.

Merchant vs. Brokers vs. Offices

Type	Owns Inventory?	Main Role	How They Work	Example Industries/Uses	How They Make Money
Merchant Wholesalers	Yes	Buy and resell goods in bulk	Purchase products from manufacturers, store them, and sell to retailers or other businesses.	Food, electronics, general merchandise	Profit from resale markup
Brokers/Agents	No	Connect buyers and sellers	Facilitate deals between manufacturers and buyers, earn commission, don’t handle inventory.	Agriculture, real estate, pharma	Commission on transactions
Manufacturers’ Sales Branches/Offices	Yes	Direct sales/distribution arm for manufacturer	Manufacturer-owned branches that sell and distribute products directly to retailers or businesses.	Auto parts, electronics, machinery	Profit from direct sales

1. Merchant Wholesalers

Think of merchant wholesalers as the classic “middlemen.” They buy products in big batches straight from manufacturers, store them in their own warehouses, and then sell smaller amounts to businesses like yours. Since they actually own the goods, they handle all the headaches like storage and delivery.

Why it matters to you: You can often get a wide variety of products from a single source, and the wholesaler takes care of logistics.
Common examples: Food distributors, electronics wholesalers.

2. Brokers and Agents

Brokers and agents are like matchmakers for businesses. They don’t own or store the products themselves. Instead, they connect buyers and sellers and help negotiate deals, earning a commission for their expertise. This is especially helpful in industries where relationships and specialized knowledge are key.

Why it matters to you: If you need help finding the right supplier or buyer, a broker or agent can save you time and open doors you might not reach on your own.
Common examples: Commodity brokers, import/export agents.

3. Manufacturers’ Sales Branches and Offices

Some manufacturers set up their own sales offices or branches to sell directly to businesses. These branches work much like merchant wholesalers but are actually part of the manufacturer’s company. This can mean better pricing and more direct communication.

Why it matters to you: Buying directly from a manufacturer’s branch can sometimes get you better deals and more reliable service.
Common examples: Auto parts manufacturers with regional sales offices.

How Does This Help Your Business?

Pick the right partner: Whether you want a one-stop shop, need expert connections, or prefer to deal directly with manufacturers, knowing these types helps you choose wisely.
Negotiate confidently: Understanding who owns the inventory and who’s just facilitating the deal can give you more leverage.
Grow smarter: The right wholesale relationship can mean better prices, smoother operations, and more room for your business to grow.

Wholesale doesn’t have to be confusing. With a little knowledge, you can find the partners that fit your needs and help your business thrive.