Intermediaries are the wholesalers and retailers who specialize in carrying out activities related to the purchase and sale of goods in the process of their flow from the manufacturer to the final consumers or buyers. They are located in the marketing channel at points between the manufacturer and the final consumers. Middlemen have continued to go strong despite all the strong arguments for their elimination, and not only in business but also in sports. There are many agents attached to athletes and in most cases, their opinions matter a lot. Thus, middlemen continue to survive because the functions they perform for both the producer and the customers cannot be performed by either the manufacturer or the consumers. Therefore, it is quite obvious that they would continue to flourish.

Disadvantages of eliminating intermediaries

One school of thought supports the complete elimination of middlemen i.e. wholesalers and retailers due to the following disadvantages associated with them.

1. Longer distribution channel: Wholesalers and retailers make the goods distribution channel longer.
2. Creation of artificial scarcity: Wholesalers and retailers usually create artificial scarcity of products through hoarding.
3. Price increase: Intermediaries also cause unnecessary price increases to the dismay of the final consumer.
4. Misinformation: Intermediaries sometimes misinform consumers.
5. Price fluctuation: Middlemen can also cause price fluctuations, especially when many of them are involved in the distribution of products.
6. Disguised unemployment: The presence of wholesalers could encourage large-scale disguised unemployment.

Reasons or Circumstances that may justify the circumvention of Intermediaries

Some manufacturers bypass wholesalers and even retailers and sell their products directly to consumers. This is done for the following reasons.

1. Increased profits: Manufacturers can increase their profits if they can sell their products directly to consumers.
2. Warehouse Ownership: Some large retailers have large warehouses and this can cause the wholesaler to be bypassed by the manufacturer.
3. Cheap products: Consumers can buy products at cheaper prices when the activities of both wholesalers and retailers are interrupted.
4. Mail order system development: There may be no need for intermediaries in the mail order system since most transactions are done by mail.
5. Manufacturer-done packaging and branding: Most packaging and branding can be done by manufacturers, making middlemen irrelevant.
6. Presence of technical goods: The manufacturer can sell directly to consumers if the goods produced are highly technical and require special specifications, for example computers.
7. Perishables: Middlemen can be eliminated when it comes to perishables, eg tomatoes, because produce can easily spoil.
8. Branded Products: Middlemen can also be bypassed when products are branded for easy identification by manufacturers.
9. Share of high-priced goods: Manufacturers also prefer to sell high-priced goods directly to consumers because they typically have low sales volume.
10. Small-scale production; Manufacturers will prefer to sell directly to consumers when the scale of production of the goods is very small.

Whether or not a grower can support himself without middlemen, it remains a simple fact that a business will not thrive without them. Imagine a business mugul who has several shipments of goods and then tells you that he doesn’t need middlemen. He may be tempted to shoot you. Intermediaries are very essential and key to distributive trading (especially in large trading companies) so they cannot be eliminated.