A wholesale channel should be evaluated using the proposed commercial terms and the work required to service it. The cost is broader than the difference between retail and wholesale price.
Model the actual agreement
Include product and packaging costs, freight, allowances, advertising commitments, return exposure, deductions and payment timing. Use the buyer’s proposal and realistic scenarios rather than a universal discount assumption.
Coordinate the assortment and channel plan
Discuss pack sizes, product ranges, promotions and customer experience. Consider how the proposed offer fits your direct and marketplace channels.
Review pricing provisions carefully
Do not adopt a mandatory MAP or resale-pricing arrangement from a generic template. Pricing provisions can raise legal issues and should be reviewed by qualified counsel for the relevant jurisdiction and circumstances.
Plan the operating and cash requirements
Confirm content, order handling, routing, invoicing, returns and credit responsibilities. A positive gross margin alone does not establish that the channel is commercially viable.
Define the channel roles before setting price
Decide what your DTC, marketplace, distributor and wholesale channels are each meant to do. A wholesale programme needs enough retailer margin to be viable while preserving a consumer price architecture the brand can support.
Model wholesale economics separately
Include wholesale price, product cost, freight, allowances, payment terms, returns, deductions, commissions and the working capital required to fund larger orders. Do not compare wholesale revenue with DTC revenue without adjusting for the costs that differ.
Create a channel policy the team can operate
Document approved products, pricing rules, promotional coordination, territories where relevant, inventory allocation and who can approve exceptions. Have legal counsel review any resale-pricing or distribution restrictions that may raise competition-law issues.
Protect inventory and service levels
A large wholesale order can consume stock needed for marketplaces or DTC. Review purchase orders against total available-to-promise inventory and replenishment timing before confirming volume.
For cross-channel ownership and planning, see fractional e-commerce management.
Define account tiers and service expectations
Not every wholesale customer needs the same terms. Consider order size, payment history, strategic value, forecast reliability and service requirements when defining account tiers. Document who can approve exceptions so special deals do not quietly become the standard.
Review channel conflict at SKU level
Track which products create recurring price or promotion tension across DTC, marketplaces and wholesale. Sometimes the best fix is assortment differentiation rather than stricter pricing. Use exclusive packs, launch timing or channel-specific bundles where commercially appropriate.
Create a wholesale readiness checklist
Before onboarding a new account, confirm wholesale price, minimum order, case pack, lead time, payment terms, freight responsibility, returns, promotional expectations and available inventory. This prevents commercial commitments from being made before operations can support them.
Review account profitability after launch
Compare gross contribution, deductions, freight, sales effort and working capital by account. High revenue alone should not determine which wholesale relationships receive more inventory or support.
Document account-specific commitments
Track exclusivity, promotional support, packaging, forecast expectations and service terms by account. This prevents commercial promises from being lost when account ownership changes.
Practical control: Maintain one account summary for pricing, terms, assortment, promotions and exceptions so commercial commitments remain visible to operations and finance.