Question

A “middleman” is defined as: “a person who buys goods from producers and sells them to retailers or consumers.” Provide an example of a middleman. What is the major function of the middleman? Would people be better off if there were no middlemen? Why or why not?

Answer 1

Answer - The retailers can be classified as the middleman in the three tier supply chain of producer , retailer and consumer. He acts as the link between the producer and the consumer. He helps to sell the producer products , and provides the consumers with the goods. But in this process , they charge some extra amount as margin in order to earn the profits. If the retailers or the other middle man are not there , the cost to the consumer will reduce as they can procure directly from the producer . Hence the people will be better off.