US Wholesale Sector

The 278,000 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.

Aug 17, 2026 - Wholesalers Challenge Expanding EPR Laws

• In July 2026, the National Association of Wholesaler-Distributors filed its third legal challenge to a state Extended Producer Responsibility (EPR) program, underscoring the growing regulatory burden these laws pose for US wholesalers. Colorado’s law began imposing mandatory packaging-recycling fees in January 2026, and some distributors can be classified as “producers” even when they do not control product packaging. For wholesalers, the broader concern is a growing state-by-state patchwork of EPR requirements. Compliance can require tracking packaging materials, weights, product flows, registrations, fees, and reporting across jurisdictions. NAW’s challenges in Colorado, Oregon, and California highlight concerns about higher costs, legal exposure, and supply-chain complexity. As more states consider EPR programs, these requirements could become an increasingly significant operational and pricing issue for national distributors.
• Wholesale trade outperformed the broader US services sector in July 2026, ranking third among 13 industries reporting growth, while the overall Services PMI rose slightly to 54.1, signaling continued expansion, according to the latest ISM Services PMI Report. Within the ISM measures, wholesale trade reported higher business activity, new orders, employment, inventories, order backlogs, and new export orders. It also experienced slower supplier deliveries and higher input prices, reflecting continued cost and supply-chain pressure. Imports were unchanged, while wholesalers reported inventories as too high relative to business needs. Overall, the results suggest solid wholesale demand and activity, but elevated costs, slower deliveries, and excess inventory remain risks to margins and working capital.
• A federal judge's pending decision on Oregon's Recycling Modernization Act could have significant implications for the US wholesale distribution industry, as the law requires manufacturers and distributors to help fund the recycling and disposal of product packaging, according to an Oregon Capital Chronicle report. The National Association of Wholesaler-Distributors (NAWD) argues the law is unconstitutional, lacks transparency, and could increase compliance costs while complicating interstate commerce. Because six other states have adopted similar extended producer responsibility (EPR) laws, the ruling—expected by the end of August—could influence legal challenges nationwide and shape future packaging regulations. If upheld, the law may increase costs for wholesalers selling into affected states, encourage packaging redesigns to reduce fees, and add compliance requirements as distributors navigate an expanding patchwork of state EPR regulations.
• AI adoption is creating opportunities for the US wholesale sector to improve efficiency, but implementation challenges are slowing progress, according to The Loadstar's State of AI in Supply Chain report. The report found that only 22.2% of organizations have deployed AI at scale, while 43.2% remain in the experimentation phase or have not started adoption. The biggest barriers are organizational rather than technical, with 53.8% citing a lack of AI expertise and change-management capabilities and 48.7% reporting integration challenges with existing systems. For wholesalers, AI is delivering the greatest benefits in document processing and administrative tasks, with 79.7% of respondents reporting measurable operational impact and 89.5% citing productivity gains. However, 62.8% have not measured or cannot quantify AI's return on investment, making it difficult to justify broader deployment. As AI becomes more common, wholesalers that successfully integrate the technology and improve data quality may gain competitive advantages through lower operating costs, faster order processing, and improved supply chain efficiency.

Industry size & Structure

The wholesale sector is comprised of 278,000 establishments that employ 6.1 million workers and generate $11 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 20% of revenue.
• In addition to employer establishments, the wholesale sector has approximately 458,000 owner-operated establishments with no employees. Subsectors with the highest numbers of nonemployer establishments are ecommerce wholesalers, agents and brokers, grocery wholesalers; apparel, piece goods, and notions wholesalers; machinery, equipment, and supplies wholesalers, and motor vehicle; these firms typically perform the work and may outsource support functions like marketing and accounting.
• The wholesale sector is forecast to grow its employment base by 3.4% overall in 2024-2034, which is much lower than the national average of 3.1% for all jobs, according to the Bureau of Labor Statistics.