who is a vendor

Who is a Vendor?

Learn about Vendors with Amjad Khan
Barsaat Ke Ek Raat 1981

Movie Case Study

The scene shows Kaliram Sahu (played by Amjad Khan) asking for his bills to be cleared. Suresh, who is the manager of the company refuses to clear the bills as all the supplies provided by him were not of good quality. In this blog, Learning Perspectives will explore the meaning of a Vendor.

Who is a Vendor?

The term vendor is used in business. It relates to an individual/business that provides supplies to the business. Supplies can be in the form of goods, services, or raw materials. Most businesses have a vendor or a supplier that provides companies with supplies. Vendors and suppliers are used synonymously.

These supplies differ from one business to another. Think of a restaurant, it buys vegetables from a supplier. This could be a long-term or a short-term vegetable supplier. If the vegetables aren’t of good quality, the contract can be terminated.

Businesses generally reach out to vendors or suppliers for their needs. This need is fulfilled by the vendor. Vendors provide both goods and services. Many companies outsource HR activities/services such as background verification of employees. A contractual vendor would take care of this need of the company in exchange for a price. Vendors are a part of the supply chain process. The vendor delivers the orders and also provides an invoice for the transaction.

Types of Vendors:

There are many types of vendors.


A manufacturer converts raw materials into finished goods with the purpose to sell them further. They sell it to retailers and wholesalers.


A wholesaler buys goods in large quantities and sells these goods to other shops or businesses. They generally sell these goods to retailers at discounted rates.


Retailers buy goods from the wholesaler or directly from the manufacturer. They sell these goods to the end consumer by increasing the price.

Who is a Vendor?

Service Providers:

As discussed above, many individuals/businesses provide services to other businesses. There are many types of services such as financial consulting, insurance services, cleaning, HR services, etc.

Independent Consultants:

An independent vendor has more control over pricing and the product he sells compared to a company under a contract. During Covid, a rise in the number of independent vendors was witnessed. Many consultants provided services to businesses. They sold their services directly to the business and no middleman is involved.

Understand Vendor with a Video

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