The digital disruption of the past couple of decades has been a challenge for traditional retailers like mass merchants and department stores, not just because online upstarts emerged as competitors, but also because brands could more easily bypass them in order to sell directly to consumers.
Some wholesale deals are at least as much about branding as about distribution, according to David Schneidman, director at Alvarez & Marsal’s Consumer Retail Group. The Sun Bum sunscreen brand began online, then turned to wholesale. Selling through “reputable hotel chains or beach clubs only elevates their equity while giving the consumer a premium experience,” Schneidman said by email.
But every brand ultimately needs some channel for mass distribution, too, Schneidman also said. And these experts all noted that consumers are availing themselves of every channel. That includes the retailers that some brands won’t partner with.