distributors don't like ecommerce?

[AffiliateDreamer]

I am sure this depends on the industry, but I have been calling up some distributors lately to get an idea how they work. It seems the ones I am calling don't really trust ecommerce people!

Example: If you don't own an actual physical location the initial order size to start is like 20K and 3K/month thereafter. I have found some that don't really care, but some of the major distributors have these sort of rules.

Could it be the pressure from brick-mortar stores?

[Essex_boy]

Maybe, but I think they are worried that your a fly by night, after all anyone can open a web store.

One major firm that I worked for wouldnt take on small accounts, they froze them out completely and by small I mean under £10K sales per month.

[legacytrader]

As an offline and online distributor of wholesale merchandise I have never had
an issue supplying ecommerce businesses, although I find that they often prefer drop shipping arrangements.

Most legitimate drop shippers have no minimum orders, so I am not sure why you are having trouble finding a supplier that is willing to work with you.

[Moosetick]

Many distributors have no-compete agreements with b&m stores and give them exclusive rights for geographic areas. Web based sites obviously don't respect geographic boundaries and therefore conflict with such arrangements.

Some distributors also don't make much markup and it is just as easy to sell a truck of merchandise as 1/2 a pallet. Therefore they may not want to be bothered with the occational small quantity purchaser. If their sales people are comissioned based and they get 0.5% of their sales they may not want to deal with a "small" $5000 order since they would only get $25.

A long time ago I ordered from a place that didn't want to deal with me much until I sent a $50 Harry and David gift basket to the office I dealt with. For a good while after that they were a lot easier to work with!

[sniffer]

We get every man and his dog ringing us up expecting immediate access to wholesale pricing because they've "got this great idea about running a business on/off line". I can get tiring...

Prove you are serious by putting in a decent order!

[Funkiest]

sniffer, what you have to bear in mind is that all buisnesses have to start somewhere, and if too many buisnesses choose not to deal with you they are laying the path for the big fish monopilising there area of expertise. If this happened then the prices of everything in our our economies would skyrocket, as there would be no competition.
thankfully i have found that the majority of wholesalers do deal with the small fish.

[AffiliateDreamer]

it seems they just want to make sure you are not just buying 'group buys' for your friends etc.

and/or someone who doesn't even stock the items and is pulling some sort of a JIT (Just-in-time stock) operation.

[ispy]

They don't like it because they are sitting there trying to move a huge wharehouse full of items, when the manufacturers will send them out one at a time for anyone who asks. So they make up some rumor about ecommerce being unreputable etc. to save their own hides, or start playing games with delivery dates (my favorite) we can get the items to you quicker if ordered by 2 pm EST, or anything else which will give them an edge.

[wingslevel]

you will always be able to find a distributor who will deal with you if you are sincere and can make a personal connection.

when i started, the number 1 and 2 distributors in my space wouldn't sell me. i went with number three. i send him $50k/ month of volume now. every year those other 2 distributors contact me offering better prices etc. no thanks.

[AffiliateDreamer]

wingslevel,

yeah actually I found one who said they will PAY freight if the order is over $300! I mean, they didn't even ask who the heck I was, they even faxed me a complete price list today no questions asked.

Is the savings from dist#1 and #2 substantial? I guess you are loyal to the guy who helped you out when noone else would...

[sniffer]

sniffer, what you have to bear in mind is that all buisnesses have to start somewhere

This is the main reason why ppl are refused accounts in the first place. Think about it... do you want to work your ass off over time to get an account with a 'big boy' only to find out that they've now decided to dish them out to any newbie who asks nicely? You will turn to them and ask "where is my protection for loyalty and volume?

[AffiliateDreamer]

Another hurdle to cross!

One of the biggest suppliers requires an initial order of 15K, but that's not the issue.

The issue is they won't even provide me with any pricing information until I signup with them!

Meanwhile the smaller distributors will tell me on the phone what pricing I will get.

I am assuming the larger distributors will provide better pricing..but i'm not sure its worth it for me to have to signup with them to find out!

[heliguy]

Yeah it's who you deal with. I cover a niche product market and I mainly import products. I have much bigger margins and I can negotiate with the customer. I recently downloaded the accounts of the top 4 importers/distributors in my area, some are holding steady while some have dropped a million over the year in distribution. If this trend continues they will realise they can't afford to neglect the likes of me forever.

Many UK distributors ignored me initially and some still do, more fool them.