Replies to post #178037 on Winning Brands Corporation (WNBD)

[butcherman]

Squeezer, it's not unusual that other vendors and distributors are involved in product procurement. We have our own distributor at Wholefoods yet we receive hundreds of delivery a week from other distributors and vendors!

[lbdave]

It actually makes perfect sense, and it's all a matter of practical logistics. All these big box retailers you mention have their own enternal distribution from warehouse to retail level, but there are outside chanels of distribution from manufacturer to the big box wharehouses. Lowes, Home Depot, or any other retailer don't want the logistical frustration of ordering their "stocked 60,000" products from 60,000 different manufacturers. They place their orders through distributors that stock many of these items in one location.

One of the problems we had when we were removed from Walmart had to do with this type of arrangemnt. I posted some information some time back about Walmart attempting to elliminate the middle man, in an attempt to reduce their cost. In fact, Eric even stated that this was one of the arrangements Walmart was trying to do with Winning Brands. Eric stood his ground on the matter by telling Walmart if they chose to by-pass the distributors they would still pay the same price for the product, even buyng direct. It wasn't playing hardball, but if Winning Brands is required to provide logistics, maintain (warehouse) additional inventory, ect... then the additional cost would be passed on to Walmart.

This was a move Walmart was trying with many products in an attempt to cut cost, but I think they have backed off the idea since nothing more has been published about the change.