Manufacturers selling both wholesale and retail

Is this SPAM?

[MrOwen]

Hello, I recently discovered that a competitors site of a client was actually owned by the manufacturer he purchases from. They are double dipping, selling through distributors and directly on the Net. Their webmaster called me because I was able to get my client good rankings and although they have deep pockets they do not fully understand all aspects of good SEO.

So.....

Is the fact they are hiding behind a false distributor front of another company negate the fact that lots of the content is the same as on their manufacturing website. To confirm this suspicion I called the manufacturers number asked for the webmaster who called me and I was patched right through....

It's the same company with a different telephone number, just marketed under a different name.

Is this duplicate content or just questionable business ethics?

[edited by: WebGuerrilla at 8:04 pm (utc) on Mar. 26, 2004]

[WebGuerrilla]

>>Is the fact they are hiding behind a false distributor front of another company negate the fact that lots of the content is the same as on their manufacturing website.

Content duplication is an algorithmic issue. It has nothing to do with who owns a site. While the two sites may share content, they serve different audiences. The wholesale site is marketing to potential new retailers, and the retail site is marketing to consumers.

[IanTurner]

And the fact that your questioning it makes it questionable business ethics.

How I look at is as follows:

If product is produced for cost C.

The manufacturer sells to a retailer at a markup m1 - Price C + m1

The retailer sells to the consumer at a markup m2
Consumer Price C + m1 + m2

The ratio between m1 and m2 is the key. Most manufacturers are happy to work with m1 being less than m2 as the economies of scale work in their favour but the more m2/m1 grows in value the greater the temptation for the manufacturer to sell directly to the public. (The alternate is also true the lower the value of m2/m1 the greater the temptation for the retailer to start their own manufacturing operation)

We are seeing a lot of that in the food sector in the UK, the supermarkets are squeezing the margins made by farmers, who respond by selling produce directly to the public.

In an ideal situation the balance between m1 and m2 is such that both sides can stick to what they know best. The retailer to retailing and the manufacturer to manufacturing.

[GeekyChic]

I must agree with Web Guerrilla, the two site serve for two purposes. I think if you could capitalize on different areas... you should do it. I applaud them for it. We have a competitor who has about 10 different domain names, some are directed to his main sites, others are treated as a different company. He'll won't be able to brand himself well this way, and that's his deal. Branding yourself is important. We have loyal customers that have been purchasing from us since we first started. We don't worry about what our competitors do too much. In the end, it's all about providing good deals and great customer service.

[digitalv]

There is nothing that says a distributor isn't allowed to sell their merchandise on the retail end as well. I don't consider it unethical at all - if I was the producer of a product, I would absolutely set up my own web store in addition to whatever other retail channels I had.

Look at it this way ... a major auto parts chain has franchise locations throughout the country, but their domain name (lets say "majorautopartschain.com") is for direct sales. Are they under-cutting their franchise owners? NO - because the franchise owners have nothing to do with setting up the website, maintaining its costs, delivering those orders, etc. Their business is their local store, not the Internet.