The wholesale industry is complex and varied. Contrary to what you might think, wholesalers are not manufacturers. Wholesalers purchase goods from manufacturers in bulk and then sell them to retailers. A wholesaler is the middleman between a manufacturer and a retail establishment. Usually wholesaling is between manufacturers and retailers, but an increasing number of wholesalers also sell to other wholesalers. Wholesale buying and selling is complicated because there are many factors involved in the buying, selling, and distribution of products. This is exactly the reason that wholesalers are at risk and need to consider protecting themselves with errors and omissions coverage.
As a wholesaler you have to do many things at once. Part of your business is about developing partners, researching import availability, designing product distribution and managing supply chain. You also have to learn enough about your customers’ industries to understand the types of suppliers they want to work with. You have to calculate the value of different volumes of merchandise and at the same time commit to contracts that lock you into supply goods for defined periods of time.
Even a wholesaler with tightly regulated controls in place and a glowing business record can be accused of missing the mark. If a retailer alleges that there was a failure of some kind, they will likely try to recoup their losses, usually through litigation. An unprotected wholesaler could get slapped with significant legal costs, even if the accusations are frivolous. That is why a properly customized errors and omissions policy for wholesalers can provide the protection and the peace of mind you need.
Every day mistakes do happen. Fortunately ACE Financial provides E&O coverage that can protect your wholesale business. Errors & Omissions coverage mitigates your financial risks if you are sued for your mistakes. If you are considering an affordable E&O policy, ACE Financial can provide you with an instant quote to get you covered right away. You can get a quick quote, fill out the application and make your payment all online – in just a few minutes!