John Coviello of Little Shop of Magic in
While I heard this same argument presented by just a few other retailers, I have to tell you that this idea of a single distributor being able to control deep discounting is, frankly, unrealistic.
While Diamond/Alliance have held a monopoly on WizKids products for quite some time now, I have yet to have seen any significant drop in offerings from Internet merchants or a raising of the price at which WizKids products are sold over this same medium. The only thing and exclusive distribution agreement will do for you as a merchant is to restrict availability, pricing and delivery terms.
This whole idea of being able to control the consumer's purchase price is a gray area which, until very recently, was downright illegal under the spirit of our antitrust laws, which prohibit anti-competitive behavior (monopolies) and unfair business practices. These competition laws make illegal certain practices deemed to hurt businesses or consumers or both, or generally to violate standards of ethical behavior. In general, competition law concerns itself with:
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prohibiting agreements or practices that restrict free trading and competition between business entities
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banning abusive behavior by a firm dominating a market, or anti-competitive practices that tend to lead to such a dominant position.
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supervising the mergers and acquisitions of large corporations, including joint ventures
As business owners, we need to get away from the idea that something is “owed to us” since we are smaller than the mega-corporation. We have to earn our business from our customers by offering them something that our competitors don't. I shop at Target and not at Wal-Mart because I prefer the atmosphere, the business practices, the quality of the merchandise and the way in which it is presented, the staff on hand and the clientèle it attracts. I never walk away from Target with the headache I get after shopping at Wal-Mart. So yes, I will gladly pay more for that privilege.
As specialty stores we have some advantages over the run-of-the-mill Internet discounters: we need to exploit them and EARN our customer's business--not try to rely on manufacturers or distributors to give us a potentially unethical “umbrella” of margin. And by following the same reasoning, I feel that a distributor has to EARN my business, by providing me with good service, better pricing, fast problem resolution, order fulfillment and so forth, NOT by having “negotiators” that leverage Diamond's muscle to bully other distributors out of the market. An exclusive is great for Diamond/Alliance but bad for us in the long run.
You have a choice every day as to what you stock, who you deal with, and what you promote to your customers. I for one had managed to deal with my “competitors” for 14 years, and have done so without having to support companies like DoW or WizKids: I highly encourage you to try the same thing. You will be surprised to see how well you can do. And, if enough of us do it, maybe both companies will seek other ways to provide “marketing support” and obtain “sales data” without having to resort to an exclusive distribution agreement...
The opinions expressed in this Talk Back article are solely those of the writer, and do not necessarily reflect the views of the editorial staff of ICv2.com.
