How marketplaces destroy traditional retail, why manufacturers need a distributor, and how to protect your brand.
Article Objectives:
- Explain to manufacturers why marketplaces are not just a new sales channel but a threat without proper control.
- Show how marketplaces profit from chaos, price dumping, and gray imports.
- Analyze why manufacturers cannot control the market independently and how internal competition within their departments creates loopholes for gray imports.
- Prove that the distributor is the key player in protecting the brand, ensuring stable prices, and managing sales.
- Convince manufacturers that working with us as their distributor is the best solution to these problems.
Table of Contents
Chapter 1. Introduction: Why Marketplaces Are Not a Solution but a Threat to Business
Marketplaces seem like a convenient sales channel, but in reality, they destroy the market if left unchecked.
Key issues without control:
- Price dumping and devaluation of products.
- Gray imports leading to loss of revenue.
- Complete dependency on marketplaces, which dictate conditions.
- Loss of brand control and market positioning.
- The importance of maintaining balance between marketplaces, retail chains, and traditional distribution.
Chapter 2. How Marketplaces Profit from Chaos and Destroy the Market
Marketplaces always profit, even when manufacturers suffer losses.
How they do it:
- Lower prices attract more buyers, leading to higher commissions for the marketplace.
- Sellers are forced to pay for advertising; otherwise, their products remain invisible.
- Gray imports flood the market, but marketplaces don’t care—they earn from every sale.
- They actively promote cheaper generic alternatives instead of original branded products.
Chapter 3. Why Manufacturers Cannot Manage Sales on Their Own
Key reasons:
- Managing a market in another country requires significant resources.
- Lack of knowledge about local legislation, taxation, and certification.
- Marketplaces ignore manufacturers but must listen to official distributors.
- Internal competition between local and international manufacturer departments:
- The international department works with the official distributor.
- The local department sells domestically at lower prices.
- Smart companies buy from the local department and import into other markets, bypassing the distributor.
- This creates gray imports, undermining pricing and brand reputation.
Chapter 4. The Optimal Sales Model: Balancing Marketplaces, Retail Chains, and Traditional Distribution
How the system should work:
- Manufacturer → Produces the product and sells only to the distributor.
- Distributor (wholesale supplier) → Manages imports, pricing, and sales channels.
- Wholesalers → Supply products to retail stores, chains, and marketplaces, but do not sell directly to consumers.
- Retail chains and traditional stores → Buy from wholesalers at a controlled price.
- Marketplaces → Should only work with retail sellers, not with wholesalers.
How to maintain balance and avoid chaos?
- Discounts on marketplaces must not go below wholesale prices.
- Prices across retail chains, stores, and marketplaces should remain unified.
- Small wholesale retailers should get special conditions to avoid unfair competition.
Chapter 5. How a Distributor Protects the Market and Ensures Stability
What the distributor does:
- Registers the brand and adds it to customs intellectual property registries (TROIS equivalent).
- Blocks gray imports at customs.
- Fixes Minimum Retail Price (MRP) and controls discounts.
- Forces marketplaces to block unauthorized sellers.
- Works with regulatory authorities (FAS, government agencies, and courts) to enforce policies.
- Official ownership of the trademark in the country closes loopholes that allow gray imports via local manufacturer departments.
Chapter 6. What Happens If the Manufacturer Doesn’t Give Control to the Distributor?
Consequences:
- Gray imports flood marketplaces, creating a price war.
- Prices collapse, and profits disappear.
- Wholesalers stop buying, as marketplaces undercut their prices.
- The manufacturer loses brand influence, and marketplaces start dictating all conditions.
Chapter 7. Conclusion: Why Working with Us Solves All Problems
What manufacturers gain by working with us:
- We handle pricing control, compliance, and distribution.
- Marketplaces, retail chains, and stores coexist in balance instead of killing each other.
- No price dumping, no gray imports—only stable and profitable sales.
- We take full responsibility for protecting your brand and market stability.
🚀 We are already implementing this system—join us now to protect your brand and market!
