Resellers can be 4 different people: Distributor: Buys a product from the manufacturer and resells to either a wholesaler or retailer. Wholesaler: Purchases the product from distributor to resell to a retail store.
Similarly, a wholesaler or manufacturer may find it too costly or inconvenient to sell to everyone who asks. If a supplier decides not to supply a business and their reason is not an improper one, the client business will have to renegotiate terms with that supplier or seek alternative suppliers.
When refusing to supply is breaking the law. There are a few circumstances, where a suppliers' refusal to supply is breaking the law. This may occur when a supplier is: misusing their market power. involved in a boycott. imposing minimum resale prices on retailers.
Historically, high capital costs of warehouse and storefront facilities tended to discourage unauthorized resellers from becoming a significant factor in the market.
If a supplier decides not to supply a business and their reason is not an improper one, the client business will have to renegotiate terms with that supplier or seek alternative suppliers.
Refusal to supply products or services. In most cases, businesses have the right to decide who they do business with. When refusing to supply is allowed. When refusing to supply is breaking the law. If you believe your supplier is withholding supply illegally. If you have any questions.
For example, a supplier may choose not to supply a business on the basis of the reliability of that business, the cost of delivery, or the presentation of goods and services.
However, if you’re planning on starting a reselling business there are some things to consider. 1 Do your research. Every platform has their own criteria and legal requirements to meet and most well known brands have restrictions. A good example is Nike and Lululemon. Both have a very strict resell policy and require that anyone selling their merchandise apply and pay to be an authorized reseller. 2 Never claim you created the product or you know the manufacturer of the brand. If you’re reselling then make sure you say “Used – Never Opened” or something similar. Because if you claim that you have access to suppliers you don’t have access to it can cost you. Generally there’s not a problem reselling something as long as you’re upfront that you owned it first. 3 Depending on the state you’re in, you need to collect sales tax. Thankfully platforms like Amazon will do that for you when you select the proper settings. This article here covers Amazon sales tax. But if you’re selling on other platforms the steps are similar and you need to figure out if they have sales tax settings. Software like TaxJar can help with filing properly.
Resale businesses leverage online platforms like Amazon and eBay. But if you want to grow then it makes sense to start your own website and spend money on advertising. You start owning more of your sale instead of giving it to Amazon or eBay.
Distributor: Buys a product from the manufacturer and resells to either a wholesaler or retailer. Wholesaler: Purchase s the product from distributor to resell to a retail store. Retailer: Purchases the product from wholesaler to sell to the customer.
A reseller is an individual person or business that buys a product, marks up the price and sells it for a profit. It’s the middle-men between manufacturers and customers. Resellers can be 4 different people: Distributor: Buys a product from the manufacturer and resells to either a wholesaler or retailer. Wholesaler: Purchases the product ...
Every platform has their own criteria and legal requirements to meet and most well known brands have restrictions. A good example is Nike and Lululemon. Both have a very strict resell policy and require that anyone selling their merchandise apply and pay to be an authorized reseller.
Retail arbitrage (reselling) is a popular method to quickly make money and bootstrap an online business. People see incredible success with the business model but it’s a stepping stone into something more permanent.
For example, Amazon has strict policies on reselling products. You can’t resell Nike or Disney merchandise. Usually corporations with big legal teams don’t allow reselling on huge marketplaces. Amazon has an entire section of restricted brands.
If you want to increase sales in a new area whether in your own country or overseas, there are two principal methods, apart from setting up a branch of your business there. One is to appoint an agent or sales rep who will promote your goods and find buyers for you. The other is to appoint a distributor or reseller who will buy your products ...
Make sure that you protect your copyright, patents and trademarks. Your distributor should only be allowed to use them while the agreement remains in place and it is sensible to have a clause which requires him to notify you and to act to protect your interests if, for example, counterfeit goods appear in the market.
If you have more than one product line, it may be sensible to restrict the agreement to one or two lines initially to see how things go. You can always add more products later. As for the territory, this needs to be clearly defined.
The agreement should also specify the currency of payment. It is not normally lawful to fix the resale prices that your distributor will charge so there is always a risk that he will offer your products at a lower price than another distributor or below your own recommended price.
Giles Dixon is a commercial solicitor with over 30 years’ experience in energy, infrastructure and construction projects, and he is also the co-author of Exporting Made Easy, a practical guide to selling overseas with agents and distributors. Here he gives advice about how to draw up a distribution agreement to ensure you have the appropriate agreement for sale in your selected market
First, to the extent the unauthorized resales occur through online marketplaces such as eBay or Amazon, these websites have voluntary takedown procedures that may in some cases enable the brand owner to achieve the removal of the offending resale activity from those sites without legal action.
Damages for copyright infringement may include actual damages and any wrongful profits earned by the infringer, and statutory penalties. In addition, the infringer may be enjoined from any further use of the copyrighted material.
Trademark infringement claims can be brought against a party that uses a trademarked name, logo or slogan in connection with a sale that has not been authorized by the original product manufacturer. Lanham Act, 15 U.S.C. 1114. As with exhaustion of patent rights, though, the trademark owner generally loses its right to enforce the trademark after the "first sale" by the manufacturer; the "first sale doctrine" holds that someone who purchases a branded product generally has the right to resell that product so long as the product is in the same condition as when it was purchased. 2
Accordingly, if the unauthorized retailer falsely states or suggests that it is an authorized retailer, and/or that its products are covered by the manufacturer's warranty when they are not, the unauthorized reseller may be liable under an unfair competition or false advertising theory.
The internet has made it easy for an unauthorized reseller to copy product images as well as product descriptions, specifications, data sheets, etc. from a brand owner's website, in order to advertise and sell branded products over the internet.
Where the unauthorized reseller secures a product through a lawful purchase, patent infringement claims may be difficult, even if the brand owner has patents covering features of the product. This is because of the doctrine of "exhaustion," which generally provides that a patent owner "exhausts" its patent rights when it sells a patented product to another. 1 Therefore, if the unauthorized reseller purchases the product in a lawful sale (as opposed to, for instance, a knowing purchase of stolen goods), then patent claims may not have much utility in terms of shutting the unauthorized reseller down.
While the brand owner's legal rights with respect to unauthorized resellers of genuine products may not be as clear-cut as with counterfeit sales, brand owners do nevertheless have rights that they should consider enforcing in these situations.