Originally Posted by joe of loath
if you want to make money become a distributor
It takes money to make money. What the distributor rely on is huge volume, because their profit margin % is even lower (our distributor makes less than 10% selling our stuff and and same goes for majority of the brands they stock) if you're someone like GP or Horizon and you have proprietary brands, then of course you make more. As someone have mentioned, you want to start a distribution company in this industry, get ready to pony up and bring a lot of capital into it.
What we are seeing currently in the industry is a lot of "shifting" of positions, manufactures trying to become distributors (almost every manufacture in the R/C industry is selling direct to shops and end consumers) and distributors trying to become manufactures (i.e. Horizon/Losi, GP/Duratrax)....there are very few "pure" distributors and manufactures left, and the hobby shops are the ones that are getting squeezed in the middle, and the main motivation behind these shifting of position by manufactures and distributors?........GREED!
p.s. I know too much and if I post any more, I will get my a$$ in trouble.