Why middlemen make more profit than the producers/manufacturers.

[cherry123]

Yes and again, the Middlemen know more about the market than the producers. Producers might just be dealing with the middlemen while the middle men deals with diverse people to sell

 

[capri]

In my country, people engaging in agribusiness at the farm level are always complaining abut the fact that middlemen (brokers) are enjoying disproportionately high profits.
The government has implemented various measures meant to protect producers from middlemen to no avail.

 

[Stardom22]

Middlemen are often the ones that seem to make more money on the chain of distribution. Some of them bridges the gap between the producers and the consumers for sure.

 

[cherry123]

Yes, middlemen are the ones that seem to make more money. They are the most important on the chain of distribution. so they are the go between making them make more money

 

[eldavis]

This might be true though, especially if the middleman has the experience. Though like every business i am very sure there would be some risk attached to this line of work as well.

 

[Niyi Briggs]

Middlemen sell at a higher price and might make more money as they add more values to the products via repackage, labeling and others. This will help to lure more people to buy

This is just the simple analogy. They add more value to the product. If a producer can add value to his product, they would make more money because they would sell to the final consumer at a high price.

 

[cherry123]

Yeah that's just the difference, They add more value to the product. which in turns lure morr buyers to the product and a lot of them are sold than before

 

[capri]

Middlemen do not usually incur the costs involved in producing services or products. All they do is obtain ready-to-use merchandise and transport the same to the market.
Accordingly, middlemen often earn higher profit margins than the manufacturers or producers of the relevant wares.