Forum Moderators: not2easy
One day, you're surfing the web and suddenly find a site that is using both your copy and images to sell the same products at a 30-40% markup. After a bit of investigation, you discover that what is happening is the offending site is actually placing orders through your site for the product to fill the orders coming through their site, so you are actually making sales through them in a backwards sort of way.
What do you do?
At first glance, my inclination is to say, let 'em keep doing it. In essence, they are an unpaid affiliate, i.e., you sacrifice no commission or margin to gain their services.
I think the major risk is that if this firm gains traffic and credibility, they may decide to cut out the middleman (you) and seek to improve margins while cutting prices. Another risk is that they poison your market by making the products you sell look very overpriced compared to competing sources. (That could happen if they enjoyed much higher traffic than you.)
1). how many orders are you getting from them? if a significant number then put your prices up, they have shown you that you are too cheap.
2). contact them and offer them a better price, they might drop their selling price and sell even more product.
3) tell them that as long as they are selling your products that they can use your graphics but if they stop getting product from you they cannot.
....
side note, we ran a line of products once ( now stopped ) where we could have joined an affiliate scheme and made 10% instead we contacted them, got them to agree to ship to our customers and include 'our' invoice and charged twice their price. they were happy and so were we.