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



Q.5:- How does the wholesaler help the manufacturer in availing the economies of scale?

 

Answer:-



Wholesalers serve as a link between retailers and the manufacturers. They collect small orders from number of retailers and pass on the pool of such orders to manufacturers and make purchases in bulk quantities. This enables the producers to undertake production on a large scale and thus take advantage of the economies of scale.