OPERATORS E137: Wholesale has the potential to ruin your business
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Oct 29, 2025 The discussion kicks off with the dilemma of brands joining Amazon—balancing customer reach against potential price wars. Next, the hosts evaluate the high stakes of wholesale, weighing the benefits of partnering with giants like Costco and Walmart against the risks posed by smaller retailers. Finally, they tackle the allure and challenges of opening physical stores, debating the potential for enhanced customer experiences against the complexity and costs involved in retail operations.
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Amazon Captures The Majority Of E‑commerce
- 60% of US e‑commerce happens on Amazon, so being off the platform leaves significant revenue on the table.
- Amazon often delivers incremental customers you won't capture on your own site.
Treat Amazon As Incremental Channel
- Do treat Amazon as incremental and test it when your customer is present there.
- Do not overvalue owning every customer's email at the cost of leaving Amazon demand uncaptured.
Amazon Scrapes Prices And Sparks Channel Conflict
- Amazon aggressively scrapes pricing and can create channel conflict that hurts major retail partners.
- Large wholesale relationships (Costco/Walmart/Target) magnify risk from Amazon's price moves.