The distribution of goods and services among consumers is done by people who are referred to as distributors in a market. They are also known as consumer agents.
The word market ordinarily refers to a particular place, where groups of shops and stalls are erected and buyers and sellers carry out their transactions.
To the economist, “market” is referred to as a set of arrangements, which enables buyers and sellers to interact with one another. It refers to all the activities involved in the process of exchange, therefore markets can exist through the telephone, newspapers, radio communication or other such media.
Types of market
There are different types of market. They differ from one another either in terms of the kind of commodities exchanged, or in terms of their special characteristics. Some examples of different types of market are presented below.
1. A labour market deals with the exchange of human labour.
2. A consumer (goods) market or commodity market provides for the exchange of consumer goods, ranging from the manufactured ones like radios and television sets to agricultural products like garri, palm oil. fruit and vegetables.
3. A financial market deals with money. It is where money can be borrowed or lent.
4. A wholesale market refers to a situation where transactions are made in large quantities. Goods here are sold in cartons, bundles, crates, dozens, etc.
5. A retail market is a situation where transactions are made in small quantities. Goods in a retail market are sold in the smallest unit and within the reach of everyone irrespective of one’s economic status.
There are two classes of distributors.
1. Wholesalers: These people buy goods from manufacturers and sell them to retailers. They buy in bulk or “wholesale”. This is why they are referred to as wholesalers. Wholesalers also pass information from retailers to manufacturers. Through this function, wholesalers help manufacturers to discover how their products can be improved and give them information about consumer preferences and complaints.
2. Retailers: These people buy from wholesalers and sell to consumers i smaller quantities or units.
a. Small scale retailers: They include hawkers, market and road ide stall holders and single shops.
b. Large scale retailers: They include cooperative societies, departmental shops and supermarkets.
These are consumer agents who carry a few basic articles such as sardines, matches, bread, fruit, and vegetables in a tray or box and sell to consumers. Hawkers enable consumers to buy goods they need without having to walk or travel a long way rom their houses or offices. However, it is usually more expensive to buy from hawkers than from the market.
C. Sales agents
A sales agent is a person who is employed to sell goods on somebody else s behalf. Goods can therefore be sent to an agent, who then sells them and remits the proceeds, or pays the money realised to the owner of the goods, after deducting his own commission and any other allowable expenses: The owner of the goods which the sales agents sell is referred to as the principal. Some wholesalers can act as agents for manufacturers.
Distributors of goods and services often organise themselves into different types of classes or associations. Examples of associations are meat sellers, garri sellers, building material dealers, small scale manufacturers and taxi-drivers. Such associations formulate a code of conduct, draw up procedure concerning goods and services, protect their business interests and some even set prices for their commodities.