(a) Describe five reasons why a manufacturer may brand his products. (b) Outline five services rendered by the wholesaler to the manufacturer.

Answer Details

(a) Five reasons why a manufacturer may brand his products

1. To identify and distinguish his products: a brand name or mark sets his goods apart from those of competitors.
2. To create customer loyalty: a well-known brand encourages repeat purchases and builds a body of loyal customers.
3. To ease advertising and promotion: a brand name makes it easier to advertise and for customers to ask for the product by name.
4. To protect against imitation: a registered brand or trade mark gives legal protection against copying by rivals.
5. To command a good price and build goodwill: a reputable brand associated with quality can attract a higher price and enhance the maker's reputation.

(b) Five services rendered by the wholesaler to the manufacturer

1. Buying in bulk: the wholesaler buys goods in large quantities, relieving the manufacturer of storage and enabling steady production.
2. Warehousing/storage: he stores the goods, freeing the manufacturer's premises and bearing storage risks.
3. Provision of finance: by paying promptly (often in advance or cash), he provides the manufacturer with working capital.
4. Distribution: he breaks bulk and distributes the goods to many scattered retailers, saving the manufacturer that task.
5. Market information and promotion: he gives the manufacturer feedback on consumers' tastes and demand, and helps advertise and promote the goods, and bears part of the risk of price changes.