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Buying From Manufacturers

One problem that all online retailers run into is that some manufacturers won’t sell to online-only retailers.  A couple of the reasons they’ve given me for this in past include: 1) to protect their brick and mortar customers (who have higher fixed overhead), and 2) to protect their brand image.

What can you do as an online retailer when this happens?

It’s tempting to try to ‘work around’ this requirement by telling the manufacturer you have a brick and mortar store.   Some will simply take your word for it, though others require you to submit pictures of the inside and outside of your store (showing your store name in the picture), and others insist on sending a representative physically to your store to verify it exists.

My suggestion is don’t try to fool manufacturers.  If you’re an online-only retailer and they don’t sell to online-only retailers, just thank them for their time and move on.  There are plenty of manufacturers willing to sell to online-only retailers, just keep looking for them.  You should always be an honest businessman, with your customers as well as your suppliers, and you aren’t being honest if you say you have a physical store when you don’t.

Still, it’s frustrating to bypass good sales opportunities.  Ultimately I think the best way to buy from manufacturers who won’t sell to online-only retailers is to open a small retail store.  This is a fairly expensive option, but the extra sales you get from selling additional brands should more than make up for the expense of opening and operating a retail store.  Remember, it doesn’t have to be a large store, and depending on where it is you may not actually need to have it open very many hours during the day.  You can also use it as the storage space for your online sales merchandise, and reclaim your house or garage for your personal use.

Similar to opening a small retail store of your own is to buy someone else’s.  This is faster than opening your own (the permitting process can be quite long), but more expensive, too, unless they’re going out of business and just want to sell out for the best price they can get.

If you have other ideas for what to do about manufacturers that won’t sell to online-only businesses, I’d love to hear from you!

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