Bebida Beverage Company (BBDA)

[SammyTheBull]

Not really. Distributors distribute but they're not marketers. What happens is that products get added to their list of product offerings. It's up to the retailers to order the product. Distributors will carry new product but if they don't sell or don't reach their distribution quota, they simply stop carrying it. Distributors don't want product taking up warehouse space when it's not selling. Those become close outs, hence the name.

So when Weber says 5,000+ stores and such, it's actually the potential for that many. For true mass distribution (thousands of stores), manufacturers normally strike a deal with the retailer. For normal distribution, it could be 1 store or 10,000 and all of that depends on price points, demographics and advertising. But purchase retail purchase managers are hesitant to order product that's never been heard of unless the price points are worth a gamble.

Distributors are just middlemen. They buy from a manufacturer and sell to a retailer. The mark-up is their profit. The retailer then marks up again and that's their profit. Manufacturer's profit is the wholesale price to the distributor minus cost.