US Wholesale Sector
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 699,324 merchant wholesalers in the US purchase goods from suppliers and sell a mix of those goods to customers. Major customer segments include manufacturers, other distributors, retailers, exporters, institutions (i.e. schools and hospitals), and service providers (i.e. restaurants and hotels). Wholesalers are also known as wholesale merchants, distributors, jobbers, drop-shippers, or import/export merchants.
Competing with Suppliers
The traditional flow of goods from manufacturer to wholesaler and then to retailer or service provider is beginning to break down.
Expansion Pressure
Rapid growth in e-commerce and consumer demand for faster order fulfillment are putting pressure on wholesalers to set up distribution facilities closer to major customers and carry a wider range of goods.
Industry size & Structure
The wholesale sector is comprised of 699,324 establishments that employ 6.1 million workers and generate $7.8 trillion in annual revenue, according to government sources.
- The wholesale sector represents 6% of the nation's Gross Domestic Product (GDP).
- The sector is fragmented with the 20 largest firms representing just 18.6% of revenue.
- In addition to employer establishments, the wholesale sector has 393,682 owner-operated establishments with no employees. Subsectors with the highest numbers of nonemployer establishments are ecommerce wholesalers, agents and brokers (16.8%), grocery wholesalers (7%); apparel, piece goods, and notions wholesalers (6.5%); machinery, equipment, and supplies wholesalers (4.3%) and motor vehicle (4.2%); these firms typically perform the work and may outsource support functions like marketing and accounting.
- While the wholesale sector shed about 56,000 establishments in 2022, it also added about 56,000 new establishments that year.
- The wholesale sector is forecast to grow its employment base by 2.4% overall in 2021-2031, which is much lower than the national average of 5.3% for all jobs, according to the Bureau of Labor Statistics.
Industry Forecast
US Wholesale Sector Industry Growth
Recent Developments
Mar 19, 2025 - Tariff Uncertainty Drives Import Cargo Growth
- According to the Global Port Tracker report from the National Retail Federation (NRF) and Hackett Associates, tariff turmoil will contribute to elevated imports at major US container ports in spring 2025, but volume could decrease by the summer. Higher tariffs on goods from China announced by the Trump Administration are driving the elevated imports, with additional tariffs looming. Jonathan Gold, NRF VP for Supply Chain and Customs Policy, said retailers are bringing as much merchandise into the US ahead of rising tariffs as possible, noting, “Retailers have been working on supply chain diversification, but that doesn’t happen overnight.” Tracker data showed that US ports handled 2.2 million 20-foot equivalent units in January 2024, which was up 4.4% month over month and up 13.4% year over year. Imports may also be affected by a proposed fee of $1-$1.5 million for each time a Chinese-built ship docks at an American port.
- Wholesale Trade is one of the 14 industries reporting growth in February’s Services ISM Report on Business. Executives in the Wholesale Trade industry reported increases in business activity, new orders, and employment, while reporting slower deliveries, decreased inventories, and higher prices paid for materials and services. Services industries reporting growth during the period included Finance & Insurance; Other Services, Utilities; Agriculture, Forestry, Fishing & Hunting; Mining; Real Estate, and Rental & Leasing. The three services industries reporting contraction during the period were Management of Companies & Support Services; Retail Trade; and Educational Services. Overall, economic activity in the services sector expanded in February, with the Services PMI registering 53.5%.
- Businesses are finding a shortage of small warehouses to lease, resulting in some companies renting temporary storage units to fill in the gap, according to a recent report in the Wall Street Journal. The report cited Cushman & Wakefield data that showed the vacancy rate for US warehouses under 100,000 square feet as 3.8% in the fourth quarter of 2024 compared to the 6.7% overall vacancy rate. One factor creating the issue is a focus by developers on the construction of big buildings for growing ecommerce operations. Only 8% of the new warehouses built in 2024 were less than 100,000 square feet, a size that typically is less profitable for developers. Meanwhile, many companies are seeking smaller warehouses to lower costs and reduce their footprints. Some firms want smaller warehouses to better distribute their inventory closer to customers, which can speed up delivery and cut shipping costs.
- According to a report in CFO Dive, consumer confidence levels, an indicator of discretionary spending, have fallen due to consumer anxiety about tariff effects and economic uncertainty. The consumer sentiment index from the University of Michigan dropped 11% in March 2025, marking the third straight month of declines and hitting the lowest level since November 2022. In addition, the Conference Board index of consumer sentiment in February 2025 marked the biggest decline since August 2021 and the third straight month of declines. According to Stephanie Guichard, senior economist for global indicators at the Conference Board, “There was a sharp increase in the mentions of trade and tariffs, back to a level unseen since 2019. Most notably, comments on the current administration and its policies dominated the responses.”
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