No secrecy of wholesale business:There is sensitive and confidential data of a wholesale supplier s business that should be kept secret like demand forecasts, competitors information etc. In some cases it becomes compulsory for wholesalers to disclose such data to their third party vendors. This can pose a danger to their survival especially when their third party vendor also provides manufacturing services to their competitors.

Less managerial control:One of their operations becomes out of their control but on the other hand, if they keep their manufacturing in-house it is more easy and convenient for them to manage their employees and operations when they are in charge of their entire wholesale business.

High cost with no control over quality:So the wholesale suppliers all the time keep themselves busy to keep their costs into their budgets in order to earn maximum profit. On the other hand, wholesalers are not sure of the quality of the wholesale products. If their finished products don t maintain the quality standards and third party vendor is not ready to accept his fault, they repeat their manufacturing process with another vendor which becomes very costly for the wholesale suppliers.

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