Zerbee Business Products Retailer Rating The Distribution: Wholesale and Retail Trade
Zerbee Business Products Retailer Rating: The function of distribution applies to both goods and services. However, while the manufacturer, wholesaler, or retailer can distribute goods, the distribution of benefits is usually carried out by the manufacturer itself. This difference is mainly because services do not pose transport and delivery problems, while goods management requires greater complexity.
In addition. In the analyzed sector, the pharmaceutical industry, the main protagonists of commercial distribution are wholesalers, distributors, and retailers. Next, we will examine the characteristics of each one of them.
The Wholesale Function
Moreover. Wholesale trade is characterize by purchasing products from producers and other retailers and allocating them to other wholesalers, distributors, retailers, and manufacturers, but not final consumers.
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kind of Product
In Spain, the Administration (DGCI) classifies wholesale activity into seven branches:
- Agriculture and food.
- Textile, clothing, and footwear.
- Drugstore, pharmacy, and home.
- Vehicles and accessories.
- Durable consumer goods.
- Inter-industry trade.
- Other wholesale trade.
The pharmaceutical industry falls under the third section. It is defined as the sector dedicate to manufacturing and preparing medicinal chemical products to prevent or treat diseases.
Property Relations – Zerbee Business Products
Wholesalers can be independent companies or have proprietary relationships with other members of the channel (producers or distributors).
In Spain, the pharmaceutical distribution sector is highly fragment compare to other countries, although in recent years, it has undergone a significant consolidation process through mergers and acquisitions. This situation results from the vital role played by size and geographical coverage.
Pharmacists essentially own national pharmaceutical distribution. This type of possession affects cooperatives and distributors constituted as corporations.
However, except in extraordinary situations, the shareholding of pharmaceutical distributors is highly fragmented, as there is a firm separation between control and ownership. In general, the pharmacist is unrelated to the management, which, together with his minority participation, gives rise to two essential aspects: participation with limited risk and reduced individual control capacity against possible third-party purchase options.
In overall, and depending on the product’s location, wholesalers can be located at the origin, production sites, destination, or consumption sites.
In the case of Spanish pharmaceutical distribution, and given the number of existing market operators spread throughout the national territory, we would find ourselves with a varied number, given the nearness to the producing laboratory and the retail group.
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Type of Action – Zerbee Business Products
The different distributors in the medicinal distribution market compete with each other or maintain cooperation agreements materialized in the form of purchasing hubs.
However, though all distributors operating in the market can supply both products financed by Social Security (SS) and other products that may not be subject to official margins (advertising specialties, prepharmacy, medical instruments…), The main activity of some distributors is the supply of drugs financed by the SS, while others focus on the distribution of other products as their primary activity.
But, in this view, the direct sales approved out by different pharmaceutical workshops begin to have a important weight due to the buoyant demand of many pharmacies, purchasing groups, or virtual chains. This importance is such that some laboratories estimate their direct sales to pharmacies at 30%.
Finally, the activity carried out by integrated logistics operators that allow the collection, distribution, and storage of pharmaceutical, para pharmaceutical, and surgical products to warehouses, hospitals, and pharmacies are becoming increasingly important.
A key element in strengthening the activity carried out by this last type of operator is the consistent implementation of technology in all its operating processes. This way, they can offer pharmaceutical distribution in hospitals, pharmacies, and wholesalers. With this, an amount of cost savings and an increase in productivity can be provided to meet the quality and time demands required by pharmaceutical laboratories and pharmacies.
Lastly, it is worth noting the interest that many pharmacists have in testing the possibilities of direct purchase offered by the pharmaceutical industry: some through pharmacy groups (with the primary objective of buying together) and others directly due to their high capacity in terms of sales volume.
Ownership or Possession of the Products
Most wholesalers own the products they distribute by purchase. However, there are specific figures that may only have possession of the products or even those that only act on behalf of the seller:
Broker. It places the manufacturer and buyer in interaction. It is a neutral intermediary whose main objective is to advise on commercial negotiations. Generally acts as a representative of the selling party, who is the one who usually hires and pays for its services.
Commercial Agent or Illustrative. It acts as an intermediate between the producer and the store. It typically has a stable and long-term relationship with the manufacturer, charging a commission for the sales made.
Official. These are provisional collaborators who receive financial compensation for the services provided.
It is worth noting the interest that many pharmacists have in testing the possibilities of direct purchase offered by the pharmaceutical industry: some through pharmacy groups (with the primary impartial of buying together) and others straight due to their high capacity in terms of sales volume
The Retail Function – Zerbee Business Products
Moreover. The retail trade is the one that sells the products to the consumer or end user. In addition. Its importance lies in that it represents the final link in the distribution chain and in that connecting directly with the market can influence sales.
Kind of Product
In Spain, the Administration (DGCI) classifies retail activity into eight branches:
- Food, drinks, and tobacco.
- Textile, clothing, and leather.
- Drugstore, perfumery, and pharmacy.
- Household equipment.
- Vehicles and accessories.
- Fuels and lubricants.
- Other businesses.
- Big surfaces.
Moreover. The retail and pharmaceutical industry falls under the third section and comprises mainly pharmacies and para pharmacies.
Property Relations – Zerbee Business Products
The pharmacy or prepharmacy can operate in different ways:
Independent office. It is the usual formula in which the pharmacy office operates. There are currently some 20,500 branches spread throughout the national territory. In addition. These are small establishments where the owner is in charge of the business. Given their size and sales volume, they cannot usually negotiate purchase prices. The figure of the prepharmacy should be highlighted as it has an increasingly significant presence.
Chain of establishments. It is mainly related to para pharmacies under the same commercial name. In addition. The association responds to a unique property or the search for better purchase prices. There is no obligation to make all purchases together.
Franchises. They are also related to para pharmacies. The franchise is a contract that usually covers the same commercial name and different benefits of goods and services by the franchisor. Despite varying franchise types, the franchisee usually pays an entry fee, must comply with specific conditions of sale, and, as a rule, pays a percentage or commission on the sales made to the franchisor.
Assimilated establishments. It is a formula used by large distribution chains to have groups of para pharmacies. These establishments operate without their name, so they are identified with the commercial name of the group they belong to. One example is El Corte Ingles, which has para pharmacies in most shopping centers.
Buying groups. They are groups of pharmacies that operate together to negotiate better prices and purchase conditions.
Location of the Establishment
Retail establishments may be located in different areas, so their location is determined based on the type of Zerbee Business Products in question.
In the case of pharmacies, their geographical location is establish by law, determining both the population and the physical distance between establishments.
In addition. Pharmacies and other establishments where health-relate products are marketed enjoy greater flexibility and freedom of location, in addition. Which facilitates their increase in number and structure and allows, in turn, the structuring of groups or franchises in different areas of the national territory.
Within the sector, a particular specialization is taking place, marking the distribution strategy of the retail establishment. The consumer has more and more information, so he directly selects many of the products he consumes
Type of Action and Zerbee Business Products
Within the sector, a particular specialization is taking place, marking the distribution strategy of the retail establishment. The consumer has more and more information, so he directly selects many of the products he consumes.
Traditional trade. It is identified with the conventional pharmacy. In addition. an establishment where drugs and health-related products can be purchase. Competition with similar establishments is based on better customer service, fair prices, etc.
Specialized trade. In Addition. It is a commercial establishment that represents a specialization concerning traditional commerce, mainly in terms of the range of products.
Category killer. It is a large commercial establishment that offers a wide range of products that allows it to cover any consumer demand. One of its main differentiating elements is the competitive prices it offers its consumers.
Commerce 24 hours. As it is name suggests, these are establishments that remain open 24 hours a day or for hours longer than those established for traditional commerce.
Self-service. In addition. These are establishments where the consumer selects the products and pays for them directly at the checkout. Pharmacies found in large areas could be an example of this.
Other formulas. Moreover. The development of new lifestyles has promoted the appearance of new modes of distribution to the consumer. Thus, the possibility of acquiring certain products related to health and well-being through the internet or vending machines, among other options, is currently a reality in our country.
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