19 | The History of Glass: Kimoto Glass's Challenge and the Story of Glass Manufacturing 2

KIMOTO GLASS is a wholesale distributor specializing in glass tableware, and I, Seiichi Kimoto, am the third generation.

When you hear "wholesaler," some people might think it sounds old-fashioned and has a negative image of exploiting intermediaries.

The idea that wholesalers were unnecessary, the "wholesaler-free" theory, emerged with the distribution revolution around the 1960s, driven by mass production, mass consumption, and the growth of chain stores. This made it possible to transport products directly from manufacturers to retailers, leading to the belief that intermediaries like wholesalers would become obsolete. However, in reality, the absence of wholesalers has sometimes put retailers at a disadvantage, and wholesalers have also implemented new management strategies, systems, and logistics. Therefore, even more than 60 years after the "wholesaler-free" theory was first advocated, wholesalers (trading companies/distributors) still exist.

Incidentally, the Tokunaga Seminar at Meiji University's School of Commerce, where I studied, was precisely a marketing-focused seminar. Learning marketing under Professor Tokunaga has led to the current state of KIMOTO GLASS.

To get a little academic, why do wholesalers still exist today?

I am more focused on the functions that wholesalers possess rather than the wholesale business model itself.

A wholesaler stands between manufacturers and retailers, procuring products from manufacturers and supplying them to retailers. There are five main functions for this:

① Adjustment of supply and demand

This is the role of mediating between manufacturers and retailers to adjust supply and demand.

For manufacturers, it is most efficient to produce the same product in a single batch, so they generally prefer large orders. However, for retailers, the quantity that can be sold at one time is limited, so placing large orders increases the risk of excess or unsalable inventory.

Wholesalers consolidate orders from multiple retailers, thereby increasing the order quantity for manufacturers and adjusting it to the optimal order quantity for both parties.

To be continued in the next installment.