External wholesalers promote pre-packaged investment products to brokerage firms and licensed agents. They are assigned to specific product lines and work alongside internal wholesalers. During sales presentations, they explain key features and benefits of certain mutual funds and receive commission when a representative sells a product.
An outside wholesaler markets mutual funds, annuities, life insurance policies and other types of pre-packaged investment products. Major investment firms employ multiple wholesalers, each of whom is responsible for managing marketing activities in a specific region. Wholesalers try to develop and enhance business relationships with brokerage firms that sell investment products, as well as self-employed agents licensed to sell securities.
Typically, an external wholesaler is assigned to a specific product line, which means that in a specific region a single company may employ one wholesaler to promote mutual funds and another to market annuities. Marketing executives create fundraising prospectuses and publicity materials for each product, but the wholesaler must produce training materials and fact sheets to supplement these materials. Fact sheets often contain important information such as purchase rates, prior year returns, and details of the securities a fund or annuity contains. Most investment firms have a wide range of products and the external wholesaler must decide which products to actively promote, as investment representatives generally prefer to sell a small number of funds.
In most cases, an external wholesaler works alongside an internal wholesaler. The latter is based in an office, while the former spends most of his time traveling and meeting clients. Typically, the internal wholesaler contacts existing business partners and potential customers and arranges for the external wholesaler to have face-to-face meetings with these groups or individuals. In a single day, the external wholesaler may be asked to make presentations to multiple groups of customers.
During a sales presentation, wholesalers explain key features and benefits of certain mutual funds. Funds prospectuses and fact sheets are provided to sales representatives attending the presentation and these people have the opportunity to ask the wholesaler questions about funds and products at the end of the session. Representatives interested in the products can order additional copies of sales materials through the wholesaler. If reps are unimpressed with a particular product, the wholesaler can give another presentation involving a different background.
Title laws in most countries mean that wholesalers need to be licensed to sell securities and many of these individuals also hold insurance licenses. In some cases, a wholesaler may hold a joint meeting with a sales representative during which the salesperson tries to sell products to a customer. Typically, wholesalers receive commission whenever a rep sells a product, so both parties have an incentive to ensure that sales meetings are successful.
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