Bypassing regional distributors ?

Is it possible to bypass regional distributors of branded products ?

Say you're sourcing something, and you're told to contact a UK distributor who loves Paddy Tax :rolleyes:, can you eliminate this company and go to another official distributor of a different region in Europe who has more favorable pricing ?

It's basic business really, looking for the best price etc.

Victor

You could try, but there is no guarantee they will deal with you. If you are a retailer, the big problem would be after sales service.

Joey the lips

This is a common strategy with aldi lidl tesco etc. They pass irish suppliers for english or english for french.

Sometime times there is geographical agreements in which case you cannot

Sometimes if your a big enough customer you can...

Its all down to purchase power and agreements.

finisklin

There's a massive grey market in the grocery sector at the moment and agreement or no agreement whoever is cheapest wins. Try some NI wholesalers for prices.....you will need too take a couple of pallets to make it worthwhile.

Don't go through official channels....for years you would find coca cola that was made in the far east in Irish TSNs where guys would sell it from the back of a van. Coca cola bottlers ireland didn't like it.....

Ok

So assuming I found a wholesaler willing to sell to me, does that mean I'm in trouble with the brand company ? hypothetical example, I contact Nike, they tell me the distributor for Ireland is in the UK, I contact the UK distributor, his prices are ridiculous so I contact another wholesaler in France whose prices are more favorable. Does that land me in potentially hot water with Nike for going to a different wholesaler as opposed to the recommended one ?

kenbrady

http://www.rte.ie/business/2009/1126/jacob.html

Deleted User

Deleted User wrote: »

Ok

So assuming I found a wholesaler willing to sell to me, does that mean I'm in trouble with the brand company ? hypothetical example, I contact Nike, they tell me the distributor for Ireland is in the UK, I contact the UK distributor, his prices are ridiculous so I contact another wholesaler in France whose prices are more favorable. Does that land me in potentially hot water with Nike for going to a different wholesaler as opposed to the recommended one ?

I dont think you would be in hot water in anyone. The bottom line is like Joey says, its all in the contracts. But the contracts between manufacturers and distributors. If you can get it cheaper from any licensed distributor around the world then get it.
Lets say the UK supplier has exclusive rights to supply Ireland, but you are able to source the same thing from France at half the price. If the distributor in France sells it to you its up to the UK supplier to contact the manufacturer to complain about this, and say hey Im supposed to have the rights for Ireland, please stop the french distributor doing this. All the legalities are between those guys not you, that would be my take on it.

Joey the lips

Deleted User wrote: »

I dont think you would be in hot water in anyone. The bottom line is like Joey says, its all in the contracts. But the contracts between manufacturers and distributors. If you can get it cheaper from any licensed distributor around the world then get it.
Lets say the UK supplier has exclusive rights to supply Ireland, but you are able to source the same thing from France at half the price. If the distributor in France sells it to you its up to the UK supplier to contact the manufacturer to complain about this, and say hey Im supposed to have the rights for Ireland, please stop the french distributor doing this. All the legalities are between those guys not you, that would be my take on it.

Spot on.... Nike in france will happily take 10k of an order but nike in the uk will complain if it owns the irish agency and 2 things will happen

1. France wont be allowed sell to you otherwise it is opening its own area to attack

2. You will have lost any chance of getting a good deal from Nike uk

If you want leverage go to addidas tell them that you want to deal with them on a 70/30 basis. ie 70% of your stock will be addidas over nike. Then go to nike and tell them the same who ever gives you the best deal take it. Be sure to write to the other one explaining that the terms were to harsh on you so you had to go with ......'s offer. Make sure you send the letter to the person responsable for sales in your area. Give it a week ring him/her and ask if they have received your letter. Do not wait for a reply. just put it in there mind that you know they know...

I am sure you will think of other ways. but you catch my drift.


I am assuming Nike/Adidas are just test cases for examples because I doubt you are talking about these boys are you???

Unfortunately I'm not Joey The Lips. I'm dealing with those two companies specifically at the moment although I wish I wasn't. Doesn't leave much room to play around with when dealing with such huge companies.

Out of curiosity, is there any way that Nike (Uk Distributor) would find out about it if I were to go elsewhere ? Surely it would be hard to discover.

Not trying to be unethical or a dick here, just looking for the best deals.

Thanks to all for the advice thus far

Joey the lips

Deleted User wrote: »

Unfortunately I'm not Joey The Lips. I'm dealing with those two companies specifically at the moment although I wish I wasn't. Doesn't leave much room to play around with when dealing with such huge companies.

Out of curiosity, is there any way that Nike (Uk Distributor) would find out about it if I were to go elsewhere ? Surely it would be hard to discover.

Not trying to be unethical or a dick here, just looking for the best deals.

Thanks to all for the advice thus far

It depends. They usually find out when orders drop in there area. People make promises not to tell but they do. Then they can usually tell from serial numbers and bar codes what area factory they were orig shipped to.

Then your competitors can come into you. Buy a pair of shoes and bingo they know where they come from.... Would they do it? I would. I ran an agency. I watched it carefully(Not for shoes ) I knew where all the imports came from although granted these days its a lot harder as they are all from china via italy via france.

This is why agency agreements have become more cast iron. You now dont but the shoe you buy the right to sell the shoe i imagine. If this makes sense....

Also you need to be careful. If nike brake an agency agreement. You can be brough to court and an injection passed to prevent you selling or pass all your profits to an agent....

TheCostumeShop.ie: Ronan

I don't think it's going to work for you mate, having chatted to you before i reckon its something online your thinking of doing. Without going through the proper channels you'll loose out on the soft part of the product, being able to use their images to advertise or on websites etc.

PM me the specifics and i'll try to help you out on this one. Before you do make sure you have acquired a UK price list and an Irish paddy tax price list.

Atlas_IRL

Agents are a pain in the hole, especially if they only agree euro prices with Irish clients. They will give Brown Thomas and House of Frasier UK prices and Irish companies have to buy in euro over inflated prices as much as 60 euro extra per product.(footwear industry)

A lot of time you will have to pay the agent fees, if they were clever enought in the first business to get the rights then so be it. Thats the way it goes. If you could say what industry it is we may be able to help more.

Atlas_IRL

Deleted User wrote: »

I dont think you would be in hot water in anyone. The bottom line is like Joey says, its all in the contracts. But the contracts between manufacturers and distributors. If you can get it cheaper from any licensed distributor around the world then get it.
Lets say the UK supplier has exclusive rights to supply Ireland, but you are able to source the same thing from France at half the price. If the distributor in France sells it to you its up to the UK supplier to contact the manufacturer to complain about this, and say hey Im supposed to have the rights for Ireland, please stop the french distributor doing this. All the legalities are between those guys not you, that would be my take on it.

Hmm i reckon they could come down on you, although actually in Ireland it can also depend on the purchasing power of the company. If the company is big(Brown Thomas) they can do what they want and do block everyone, i know first hand and also from other high street retailers. It really depends on what you are bringing in.

Thanks for the info lads, will be thinking about this...