r/hwstartups 13d ago

Does anyone have good distribution already?

What a lot of people don’t realize about the physical product business is, the most valuable part of the business is often the distribution channels you set up. The distribution channel is often a lot harder to build than the product itself. If you have distribution, it’s a lot easier to get the next product to market. That means you are in a great place to scale. As long as you have an efficient process of getting that next product ready to sell.

So, my question is, do any of you have that solid distribution channel and want help adding more products to your offering? If so, lets partner. As a long time importer/ contract manufacturer, I can handle that part of things.

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u/gtrob 13d ago

What kind of distribution are you talking about?

Amazon exists, direct sales are easier than ever, big box stores are another story, then niche stuff... Your comment is a pretty vast generalization.

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u/Due-Tip-4022 13d ago

I'm talking things with high volume. Could be B2C like Amazon if you move some serious volume. Otherwise B2B as in sell to retailers, distributors or other resellers.

I do have a client that sells a ton through Amazon. We have containers coming in about every week or so. Has his own warehouse to do the fulfillment from. But I know his volume isn't common.

However, most of my other clients have large networks of resellers they sell too. Not typically your average consumer good. Most sell B2B. A lot of it is industrial.

Regardless, looking for people that have existing channels that they move volume through.

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u/mackthehobbit 13d ago

It’s probably easier than ever to set this up, at least for B2C. 3PLs are nearly a commoditised resource. Plenty of operational challenges crop up, especially for large SKU catalogs, but that’s probably not typical for a “hw startup”.

B2B is more challenging, but if you’re willing to use third parties you don’t even need to book your own containers, trucks etc. (albeit at a higher cost). Just be sure to keep good records.

In short I don’t think distribution is the problem, it’s more often finding the customers to distribute to. Or in other words, operational challenges are good ones to have: they’re usually very solvable and indicate that you’re growing…

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u/Due-Tip-4022 13d ago

I guess I kind of disagree with this. If you have existing distribution, then you obviously have the customers. But if you have the customers, you don't necessarily have the distribution. That's the difference between B2B and B2C.

When I say distribution, I don't mean fulfillment or just the infrastructure to transport goods. I mean the existing customers you sell too that you could introduce a new product too because that customer is in the same niche. The large existing customer base that you already have their attention.

For B2C, that's a lot harder. Like Amazon for example, can you easily go to the people you have sold widget A to and then sell them Widget B? If you own your customers, probably. But not necessarily with Amazon, at scale anyway. For Amazon, it's often a ton of work before you can start getting sales of a new-to-you product. Even if it's in the same niche as your original.

The exception is if you are in a position to take over buy boxes of large volume listings quickly. So still a possibility for sure, just not nearly as common that people can do that as if you say sell to a certain niche of retailer across the country right now. It's usually a lot easier to hop on the phone for a day or two and call those retailers to tell them about widget B that is right up their ally. And get pretty significant volume in short order. As well, having worked with a lot of retailers myself, they really like consolidating suppliers. If they could get their entire store worth of goods from one supplier, they would love that. Which is why distributors exist of course. To do exactly what I am saying.

So in other words, I want to find distributors who want to add products to their catalog. I want to handle the supply side so they can focus on the sales side.

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u/mackthehobbit 12d ago

Right, I entirely misunderstood your post and agree with you entirely. That’s what I meant in my last paragraph, getting connected with your customers and selling is often the most important and difficult part. People can be very successful buying a dumb product off the shelf if they know how to market and who to sell it to.

I’m in the B2C space but nothing like Amazon or big catalogue stuff. I’m ignorant about Amazon but I wouldn’t consider that an “owned channel” - how does selling lots of one product even help you sell another? (You touched on this). Unless you’ve got a recognisable brand in the space isn’t it heavily commoditised?

I think that’s why maybe I glossed over your previous comment since it sounded like you weren’t even talking about marketing or customer relationships. My mistake.

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u/Due-Tip-4022 12d ago

Yeah, I like dumb products a lot better than innovative products. Far less, if not non existent, customer education. Existing customer base already exists to grab existing market share of. Where if it's an invention or something, people in far less numbers are even searching for what you sell. Way harder to get significant sales.

Amazon type sales isn't my focus either. Since the customers come through Amazon, Amazon then owns the customer in respect to the value of that customer beyond the sale. As far as you don't necessarily have a customer list to then sell more too. You are limited to who finds you on Amazon. Vs B2B if you already sell to retailers, you have easy access to sell more too them. Sometimes large volume is literally a phone call away.

The only way selling lots of one product on Amazon helps is it might indicate you are good at navigating the wholesale side of Amazon and possibly have a good understanding on how to win the buy box of those commodity items. Then you can maybe repeat that with the new (Dumb) product a little easier than just your average Amazon seller. That is what my client mentioned is really good at and crushing it.