Preventing Authorised Retailers Selling on Amazon

[Bigbird82]

Hello,
As a manufacturer that sells products directly B2C as well as through third party retailers, is there a way we can restrict these authorised retailers (they are authorised to sell in their shops and websites) from selling on Amazon? It is felt it undermines both the Brand and also those retailers making an effort to sell the products on their own sites with a premium experience.

I'm aware of the Brand Registry scheme but this seems to relate to preventing counterfeit products rather than policing authorised retailers but I may have misinterpreted this.

Thanks in advance,
Al

 

[wayzgoose]

We have a couple of suppliers that say their products must not be sold on Amazon or Ebay. If you do, they just close your account.

 

[finleydesign]

You would need to introduce restricted terms on sales outlets, and that you authorise sale via own websites, however will not accept sales made via third party outlets ie Amazon, Ebay ....... etc

Theres quite a few companies over the years that have pushed this onto their retailers, remember it's your product, you can control and have the right to control how it's represented or sold online

 

[Stedurham]

Years ago sold beds and mattresses in retail, tried online didn't realise, manufacturer was in within the week. Said broke terms so stopped, fair enough I thought. Others didn't and they closed accounts doing millions.

 

[Ecommerce&MailOrderGuy]

This is a 'hot potato' issue that many businesses face.
A very grey legal area that is evolving all the time.
It used to be considered as a 'restriction of trade' and open to litigation if you put a non- third party selling channel in your retailer T&C's. But the latest I am hearing is that you can now put such a clause in your customer contracts. This news came from a big company who had just had the lawyers in. But I am certainly not legally qualified and personally would not take this step until I was more confident this approach was now safe and watertight. Hopefully another board member 'in the know' might be able to clear this one up???

 

[Mr D]

Dozens of suppliers refuse to supply to traders who sell on 3rd party sites.
They inform the sellers, then after a suitable time they inform the sites that the products are no authorised to be sold there.

Plus stop selling to any retailer selling there. Nothing to say a supplier has to sell to all retailers.

 

[Guy Incognito]

You're in a tricky position - presumably you're still making money from the authorised retailers?

Could you include something in your agreement with the authorised retailers?

We only sell B2C for this reason (which of course has plenty of issues!).

 

[lesliedocherty]

Super common in fashion industry, its in their web sellers agreement, you need permission to sell online, lots of brand do not allow selling on 3rd party platforms, it needs to be in the terms though

 

[MBE2017]

I had a company decide to stop resellers selling on eBay and Amazon, under the argument it devalued the brand. I was selling 20 items per week at full retail, found out the cheapest competitor, the one undercutting everyone was the manufacturer themselves.

Dropped the company, as did most of its retailers, they sold a max of twenty per month, the resellers had sold 1-200 per month before for more money. They asked myself to start stocking their products again, and said I could sell anywhere, you can probably guess what my answer was.

 

[Mr D]

I had a company decide to stop resellers selling on eBay and Amazon, under the argument it devalued the brand. I was selling 20 items per week at full retail, found out the cheapest competitor, the one undercutting everyone was the manufacturer themselves.

Dropped the company, as did most of its retailers, they sold a max of twenty per month, the resellers had sold 1-200 per month before for more money. They asked myself to start stocking their products again, and said I could sell anywhere, you can probably guess what my answer was.

One of the companies I used to buy from and sell their stuff on ebay - they've doubled in turnover since people cannot get their products on 3rd party sites cheap.
Established brand selling in shops for dozens of years and having tens of thousands buying their stuff regularly.

We never undercut - but due to some desiring to be always the cheapest we lost out on a supplier of good stock.

 

[Danny Whitaker-Leach]

Brand registry on Amazon does give you some control with regards to stopping unauthorised resellers of the product

I am not 100% sure how much restriction it does give you but worth reaching out to Amazon for

Another big advantage as the brand owner if you did want some sellers on Amazon is you can control the quality of the content meaning it doesn't devalue your brand

I would make an enquiry with the brand registry team to see

 

[Bigbird82]

This is a 'hot potato' issue that many businesses face.
A very grey legal area that is evolving all the time.
It used to be considered as a 'restriction of trade' and open to litigation if you put a non- third party selling channel in your retailer T&C's. But the latest I am hearing is that you can now put such a clause in your customer contracts. This news came from a big company who had just had the lawyers in. But I am certainly not legally qualified and personally would not take this step until I was more confident this approach was now safe and watertight. Hopefully another board member 'in the know' might be able to clear this one up???

Thanks for the insights. Can I ask where you saw this news?

 

[Ecommerce&MailOrderGuy]

Try googling this and you will see many different opinions online but no rules to follow. I personally want to add a 3rd party prevention clause in our retailer T&C's but I'm not going to be the first in my industry to do it. Many competitors are straining at the leash to find a solution so they can just get on with regular business.

 

[Mr D]

Some companies simply tell amazon the seller is not authorised to sell their products.
Then the seller account gets suspended. And one very annoyed seller has to contact rights owner (ie supplier) to ask them nicely to inform amazon the situation is sorted.

If the supplier bothers to reply.... but not necessary.

 

[dan19900]

Can never understand companies doing that. Loses you sales for a start and means a lot of small business owners (some of which will grow) have a grudge against you.
Had that happen to me in the past, now my company is a lot bigger they literally beg me to sell their products. Now every time a customer asks us if we have their products (about 10 times per week) we tell them it's shit and recommend them something else.

 

[Mr D]

Can never understand companies doing that. Loses you sales for a start and means a lot of small business owners (some of which will grow) have a grudge against you.
Had that happen to me in the past, now my company is a lot bigger they literally beg me to sell their products. Now every time a customer asks us if we have their products (about 10 times per week) we tell them it's **** and recommend them something else.

Perhaps they have had experience of sellers on amazon...
Always some idiot who can spoil things for everyone else.

A decade ago my list of suppliers who would sell to amazon and ebay sellers was quite large. These days its larger due to talking to more suppliers. And over 30 of the companies a decade ago that were willing to sell to 3rd party site sellers now no longer allow their products on amazon or ebay at all so removed from that list. Another few will allow only certain long term customers to sell there, any other seller tries it gets removed.

 

[Bluejen84]

My industry the wholesalers at least give a front to show support to "bricks & mortar" shops first. Usually there is clauses you can sell online on your own site ( for example one company does drop ship) but can't sell on eBay or Amazon.

 

[Guy Incognito]

Can never understand companies doing that. Loses you sales for a start and means a lot of small business owners (some of which will grow) have a grudge against you.
Had that happen to me in the past, now my company is a lot bigger they literally beg me to sell their products. Now every time a customer asks us if we have their products (about 10 times per week) we tell them it's **** and recommend them something else.

The other side of the coin is this:

We've spent time and money developing and designing our products. You can't buy them anywhere else (which to us is important for our brand / exit plan). We get lots of companies wanting to dropship, or re-sell, and they want margins which are not affordable to us due to our prices - we didn't factor in re-sellers when establishing the business, which is absolutely our fault.

Obviously changes industry to industry and whether you have a niche or not. Makes no sense to me where there is no IP involved and they are generic products.

 

[Mr D]

The other side of the coin is this:

We've spent time and money developing and designing our products. You can't buy them anywhere else (which to us is important for our brand / exit plan). We get lots of companies wanting to dropship, or re-sell, and they want margins which are not affordable to us due to our prices - we didn't factor in re-sellers when establishing the business, which is absolutely our fault.

Obviously changes industry to industry and whether you have a niche or not. Makes no sense to me where there is no IP involved and they are generic products.

Dropship cost tends to be somewhere between wholesale and retail price.
Margins are their problem - you just price it at what you want.

Heck, the dropshippers using my business are paying retail price - they will be selling the items for higher than I've charged them.

 

[DontAsk]

Heck, the dropshippers using my business are paying retail price - they will be selling the items for higher than I've charged them.

I can never understand the fools who will buy on Ebay for more than the cost direct from the manufacturer (or, indeed, other retailers).

Don't even mention the real idiots who will pay more than retail price for used items.

A fool and his money...

 

[Mr D]

I can never understand the fools who will buy on Ebay for more than the cost direct from the manufacturer (or, indeed, other retailers).

Don't even mention the real idiots who will pay more than retail price for used items.

A fool and his money...

The business model followed by dropshippers means they don't spend the money taking a chance on stock and having to spend hundreds of pounds buying in bulk.
For 30 seconds work (or less if automated) having the order placed for a few quid...

Now times that by hundreds of orders a day. Thousands even. For say £3 profit per order and minimal fixed costs.

As compared to a traditional retailer who may spend 3 years selling an order of £500 worth of products and the cost of storing the stock.