Wholesale Trade

The wholesale trade division includes establishments or places of business primarily engaged in selling merchandise to retailers; to industrial, commercial, institutional, farm, construction contractors, or professional business users; or to other wholesalers; or acting as agents or brokers in buying merchandise for or selling merchandise to such persons or companies.

The chief functions of establishments included in wholesale trade are selling goods to trading establishments or to industrial, commercial, institutional, farm, construction contractors or professional business users; and bringing buyer and seller together. In addition to selling, functions frequently performed by wholesale establishments include maintaining inventories of goods; extending credit; physically assembling, sorting, and grading goods in large lots; breaking bulk and redistribution in smaller lots; delivery; refrigeration; and various types of promotion such as advertising and label designing.

The principal types of establishments included are: merchant wholesalers-wholesalers who take title to the goods they sell, such as wholesale merchants or jobbers, industrial distributors, voluntary group wholesalers, exporters, importers, cash-and-carry wholesalers, drop shippers, truck distributors, retailer cooperative warehouses, terminal elevators, cooperative buying associations, and assemblers, buyers or cooperatives engaged in the marketing of farm products. They also include sales branches and sales offices (but not retail stores) maintained by manufacturing, refining or mining enterprises apart from their plants or mines for the purpose of marketing their products; as well as agents, merchandise or commodity brokers, and commission merchants.

Establishments primarily engaged in selling merchandise to construction contractors, institutions, industrial users, or businesses are included in wholesale trade with a few exceptions. These exceptions are necessary because of sales to both the general public for personal or household consumption and to businesses, industrial users, or construction contractors. These exceptions are lumber yards; paint, glass, and wallpaper stores; typewriter stores; stationery stores; and gasoline service stations.

However, establishments that sell similar products only to institutions, industrial users, and establishments that sell merchandise for use exclusively by businesses or to other wholesalers are classified in wholesale trade. Establishments primarily engaged in selling such merchandise as plumbing equipment; electrical supplies; used automobile parts; and office furniture are classified in wholesale trade, even if a higher proportion of their sales is made to individuals for household use. Establishments primarily engaged in the wholesale distribution of used products are classified on the basis of the products sold.