Well, each warband has its advantages and disadavantages. There are two occasions where people posted their concerns with the Merchants (one of them being on this board, the other on another forum). One was fearing that the warband was too weak (like you now), the other one was fearing that the warband was too strong. It is really interesting to see how differently people evaluate warbands.
The first thing you should probably do is NOT compare the warband to what I like to call the "power races" (=Beastmen, Orcs, Dwarfs). These are races who have stats (and skills) which are way superior to humans and their sheer bruatlity in close combat is balanced (well, that's the idea at least) by giving them a lack of shooting or a lack of versatility in other ways. So comparing them with those warbands will never work.
The caravan consists of humans so you should compare them to other human warbands (Mercenaries). You will then see that the caravan has access to some of the best quality warriors you can wish for as a human captain. They have the great marksmen from the Reiklanders (WS4), some above average close combat types and even a wizard as a starting Hero. The options are very strong and should probably look like "too strong" at first sight when compared to other human warbands. The downside (and flavour) of the merchant
lies in that they have to buy and maintain the Trade Wagon (note that they start with 600gc), which makes them even more prone to ambushes from enemy warbands. Also you may need some experience with wagons (see Empire in Flames rules) to see how easily they get out of control.
The warband has some excellent model choices, from strong Heroes (Vanguards, WIzard) to the feared Marksmen and strongman-warriors. I would choose them any day over a normal Mercenary warband because of their more interesting models and the flavourful and cool trade wagon. All in all I think they compare quite well to other human warbands.
EDIT: Nice, Identity. You, once again, beat me to it.