I have an opportunity to buy directly from a manufacturer who will allow me to officially rep their products on Amazon if I spend $500,000/year. They are all MAP. They have enough of a selection (over 1000 skus) that there are enough ranked items with decent quantity and quality of reviews to choose from. Amazon is selling roughly 1/4 of the items. Total number of other competitors per listing is within reason. My cost is approximately 50% of MAP. The average cost per item is $50. Yay or Nay on this deal and why? Let’s say the deciding factors don’t have to do with coming up with the money or fear of suspension.
If you look at the 3/4 items that AMZ does not carry and those have good rankings, I would go for it. I like the relatively high ASP. I wonder if you can negotiate with them that AMZ would not carry further items, otherwise, every time an item would start selling well, they will take over….
I would want exclusive rights no selling to Amazon included other than that I would look at your business cash flow and see if this is doable I personally would not want to extend more than 30 percent of available capital to one company
Please login first to submit.