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The Pros and Cons of the Indirect Sale

Jeff Cochran

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Many companies—particularly new or small firms—may wonder if there’s profit in indirect sales. The debate has been going on for many years, and any simple internet search will render countless opinions about the best business decision. Like most things, there are pros and cons that you need to examine fully before you make your choice.

Pros

  • Indirect sales channels have more visitors. Since these websites and businesses are already established, they have an existing customer base. People get exposure to your brand during their regular shopping, even if they’ve never heard about it before.
  • A sales channel can be more functional. Larger companies may have access to better programs and technology, making for a more sophisticated customer experience. You can eliminate the need to build your own website when you list products with an affiliate or on a marketplace.
  • They provide lower maintenance once established. Since you’re not in charge of the channel itself, you don’t have to worry about upkeep or updates. The initial setup may be a bit extensive, but after that, your ride may be significantly easier.
  • Expansion is at your fingertips. Working with an indirect sales channel can give you nationwide or global access Instead of having to build your own team, you can rely on their existing resources to get your brand into the far corners of the world.

Indirect sales are a clear answer for some businesses, but not others. Considering the downsides of third-party involvement is important when choosing the future of your business.

Cons

  • They’re not as passionate. Since you have your own time and money invested in your business, you want it to work. It may be a lifelong dream or even your lone source of income. But no matter how incredible your products are, an affiliate will never be as eager. They have their own companies to run, and if you want maximum drive, you’ll have to do it yourself.
  • There can be conflict. The world is full of competitors, and it may be hard to find a channel that can work for you—particularly in more heavily populated areas.
  • You have more competition. Most partners aren’t going to stock only your brand—after all, it’s less profitable for them. Customers enjoy having options, and it’s likely that the product of your hard work will be right next to its biggest contender.

With the proper relationship and platform, indirect sales can be incredible. They may reach far greater heights than you ever could alone, but it won’t come without cost. Consider all the facts and make the choice that’s best for your business.