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  1. #1
    Defender of Truth, Justice and the Affiliate Way
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    Just got a call from the manufacturer of a health product I sell online. This company is very particular about how their products are sold and only allow them to be sold through licensed healthcare providers. I'm a licensed Physical Therapist, so distributors are allowed to sell to me.

    First, they began by questioning me about which distributor I purchase from. I evaded that question. Then they brought up the point that it could only be sold by licensed heath professionals and I told them the owner of the company was a licensed Physical Therapist. Next they stated that it was their "policy" that a price for the product could not be published over the Internet. ?????? When I pointed out that many other places were selling the product over the Internet listing prices, their response was yes they knew but are trying to police it. I have seen one competitor that has a notice that prices can not be posted per the manufacturer. They also wanted to know if I sold to patients or to professionals, and I told them patients. They said, oh if you were selling to professionals we going going to offer you a distributorship. :confused:

    I think that they are not wanting their product sold over the Internet. Now last year I sold 3506 units of their product. This year so far I've sold 2427 units. I've never followed their philosophy on how their products are sold.

    My question to any other merchants is what is your experience with how a merchant limit how their product is sold. If they say the product can be sold to licensed professionals and I'm a licensed professionals, what rights do they have as to what I do with the product after I buy it. Whether it's just using it in a clinic, selling it in a clinic, or selling it on the Internet? And the whole thing about not being able to list on my site how much the product costs? They said I could say I have it available, but couldn't say how much it costs. I'm not low balling prices. I really wonder if there are any legal grounds to them making that statement.

    The conversation ended with them saying I may be hearing back from someone else. Their legal department possibly? Any thoughts from other merchants are appreciated.

  2. #2
    Full Member
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    Not a merchant (or even aff reply):

    You're selling what sounds like a lot to me - I'm thinking they think you won't want to give that up. So they're fishing for what kind of licensing fee they can stick you with (professional, merchant, affiliate, wholesale, retail, whatever).

    IOW, I'm thinking they're shaking you down.

    Of course I'm not really known for my thinking.

  3. #3
    Member
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    Bestlittlefreehouse,

    In no way am I posting the following as an example of Knack Technologies practices. We feel the internet is a great sales venue and our desire is to keep affiliate generated sales as high a percentage of the total as possable. That said, this is some of what goes on.

    There are some contracts that wholesalers, retailers, product reps. and others are bound to. You would think this is silly, however it is a capitalist world and everyone wants the edge. On that note however we want sales!!!

    To give you an example, we have a contract with our biggest retailer that states we must give them any price breaks we offer any other retailer. This occasionally ties our hands dealing with some retailers who want large upfront pricing, but can not guarantee a continued income stream. Retailer one buys a case for x, retailer two wants 100 cases one time for x-1. We can do this, however now retailer one also gets this discount forever.

    Manufacturers reps get into the picture and it gets worse. Reps get tied to geographic territory and then some one starts selling on-line across this border and the rep loses sales. I have dealt with several companies that will not allow for internet sales due to territory issues.

    The reason they wanted to know about who you where selling to was to get one of their reps in their to take your business. The reason for no price displays, is again territorial. The following is a real example from my last job;

    We sold electrical supplies and lighting, the MSRP on lighting is 300%(no joke) our store believed 50% was sufficient which makes our price half of the MSRP and other vendors. Two of our manufacturers will not allow us to advertise 30 miles north because our prices are half of one of their other retailers, while they can advertise where we are all they want.

    Sorry for the long post.

  4. #4
    Defender of Truth, Justice and the Affiliate Way
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    @jaybat: You could be right. They may be checking things out. I hear through my distributor that they've had some staff changes. Could be they are getting the lay of the land.

    @Craig: Thanks for the info. I retail their product. They only sell directly to their distributors, so they don't have any reps per say that I would be competing against. I've gone through several distributors and I have a very good relationship with the one I'm working with now. Thinking about it some more I think their trying to get a grip on the whole Internet thing. They want a certain high end image attached to their product. I don't think they want people to be able to get it at the local Wal-Mart or have it lumped with a bunch of those "miracle" products out there. I can appreciate that. I've seen many sites which which hawk the product, and I think that's what they are wanting to avoid. I know when I first started my site someone from the company came by my site because they joined my newsletter. I provide health information as well as rehab type products. I figured everything was cool with them, because they had been by my site and I heard nothing from them. I'll just hang loose and see what pans out.

    But I guess I'll have to get in gear and get some more products I've been wanting to add to the site up just in case they try and pull the plug. But I know I'll have to see it coming down off of other sites too. [img]/infopop/emoticons/icon_smile.gif[/img]

  5. #5
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    Your welcome, just my two cents.

    Good luck,

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