Every brand that sells through US marketplaces eventually faces the same question: should we work with a partner, and if so, what kind? The marketplace ecosystem is full of entities that will offer to sell your product, but the operational reality of what they actually do, and what they are accountable for, varies enormously.
The most important distinction brands need to understand is the difference between a distribution partner and a reseller. These are not interchangeable terms, and treating them as if they are leads to misaligned expectations, lost margin, and operational problems that compound over time.
What a Reseller Actually Does
A reseller buys your product and sells it. That is the core of the relationship. They place purchase orders, take ownership of inventory, list the product on one or more marketplaces, and keep the difference between their buy cost and the sell price minus fees.
Some resellers do this well. Many do not. Here is what the reseller model typically looks like in practice:
Listing Control. The reseller creates or modifies listings to optimize for their own sales velocity. This may or may not align with your brand standards. Titles get rewritten. Images get swapped. Bullet points get keyword-stuffed. If you do not have Brand Registry or a robust brand protection program, you may not even know this is happening until a customer complains.
Pricing Behavior. Resellers set their own prices. If they bought at a good margin, they may undercut your MAP (Minimum Advertised Price) policy to win the Buy Box. If multiple resellers are on the same listing, price erosion is almost guaranteed. This is the single most common complaint brands have about the reseller model.
No Operational Transparency. Most resellers do not share sell-through data, advertising performance, or inventory velocity with the brand. You ship product to them and hope for reorders. You have no visibility into what is actually happening on the marketplace, which means you cannot plan production, forecast demand, or identify problems early.
Short-Term Orientation. Resellers are optimizing for their own margin on each transaction. They are not investing in your brand's long-term marketplace presence. When a product stops being profitable for them, they stop ordering. There is no strategic conversation, no transition plan, and no continuity.
This is not a criticism of all resellers. Some are professional, some respect MAP, and some communicate well. But the structural incentives of the reseller model do not align with the brand's long-term interests on the marketplace.
What a Distribution Partner Actually Does
A distribution partner operates as an extension of the brand's own marketplace team. The relationship is authorized, structured, and built around shared performance outcomes rather than transactional margin.
Here is what that looks like operationally:
Authorized Representation. The distribution partner operates under a formal authorization agreement with the brand. This means the brand controls who is selling, what the listing says, and how the product is priced. Authorization also provides legal standing for brand protection enforcement against unauthorized sellers.
Full Operational Ownership. A real distribution partner handles the entire operational stack: catalog management, listing creation and optimization, inventory planning, fulfillment prep, inbound logistics, advertising management, and customer service. This is not just buying and reselling. It is running a marketplace business on behalf of the brand.
Reporting and Accountability. Distribution partners provide regular reporting on sales, advertising spend and return, inventory levels, sell-through rates, and operational metrics. The brand has visibility into what is happening and can make informed decisions about production, marketing, and expansion. This transparency is foundational to a functioning partnership.
Brand Standards Enforcement. Listings are built and maintained to the brand's standards. Content, pricing, imagery, and promotional strategy are aligned with the brand's broader go-to-market plan. The distribution partner is not freelancing with your brand assets.
Long-Term Investment. A distribution partner invests in the brand's marketplace presence over time. That means building review velocity, optimizing advertising campaigns through iterative learning, expanding the catalog strategically, and planning for seasonal peaks and new product launches. This is fundamentally different from a reseller buying whatever is on deal this month.
At Oxalis Supply, this is the model we operate. We function as the brand's authorized marketplace distribution partner, handling operations end to end with full transparency. You can review the scope of what that includes on our capabilities page.
The Operational Depth Gap
The biggest difference between a distribution partner and a reseller is operational depth. Here is a concrete comparison across key functions:
Inventory Planning. A reseller places POs when they want product. A distribution partner forecasts demand based on sell-through data, advertising plans, seasonal trends, and marketplace dynamics, then coordinates inbound timing to maintain in-stock rates without overcommitting capital.
Listing Management. A reseller may create a listing and never touch it again. A distribution partner monitors listing performance, tests content variations, responds to search algorithm changes, and keeps product data current across marketplace requirements that shift regularly.
Advertising. A reseller may run basic sponsored product ads to drive their own sales. A distribution partner builds a full-funnel advertising strategy with sponsored products, sponsored brands, sponsored display, and demand-side platform campaigns, all tied to the brand's goals and reported back with transparent spend and return data.
Compliance. A reseller assumes the product is compliant and lists it. A distribution partner reviews product compliance documentation before listing, flags potential issues, ensures labeling meets marketplace and regulatory requirements, and monitors for policy changes that could affect active listings.
Customer Experience. A reseller handles returns and customer questions as a cost center. A distribution partner treats customer interactions as brand touchpoints, maintaining the brand's voice and using customer feedback to improve listings, packaging, and product positioning.
The Margin Conversation
Brands often gravitate toward the reseller model because the upfront economics seem simpler. You sell at wholesale, the reseller handles the rest, and you collect your margin without the complexity of marketplace operations.
But this framing ignores several real costs:
Price Erosion. When resellers compete on price, the brand's perceived value drops. Recovering from a period of aggressive discounting on Amazon is extremely difficult. Search ranking, customer price expectations, and category positioning all take damage.
Lost Data. Every sale a reseller makes is data the brand does not have. You cannot optimize what you cannot measure. Brands working through resellers consistently underinvest in high-potential products and overinvest in declining ones because they lack the marketplace-level data to make good decisions.
Brand Damage. Poor listings, slow shipping, bad customer service, and inconsistent pricing all reflect on the brand, not the reseller. Customers do not distinguish between the brand and whoever is selling it. One-star reviews caused by a reseller's operational failures live on the listing permanently.
Switching Cost. When a reseller relationship ends, the brand often has to rebuild from scratch. Listings may be controlled by the reseller's account. Review history may be tied to a listing the brand does not own. Advertising data and campaign history are lost. The distribution partner model avoids this because the brand retains ownership of the relationship with the marketplace.
A distribution partner typically takes a percentage of revenue or operates on a landed cost model that is transparent and predictable. The all-in cost may be higher than a simple wholesale transaction, but the value returned, in terms of data, brand protection, operational quality, and long-term growth, is substantially greater.
How to Evaluate a Potential Partner
Whether you are evaluating a reseller or a distribution partner, here are the operational questions that separate serious operators from everyone else:
Ask About Their Prep Operation. Do they have their own prep facility or do they outsource? What are their defect rates? How do they handle product-specific prep requirements? A partner that cannot answer these questions in detail is not running a real operation.
Ask About Reporting. What will you see and how often? If the answer is a monthly sales summary with no detail, that is not a partnership. You should expect weekly or biweekly reporting on sales, advertising, inventory, and operational metrics.
Ask About Brand Protection. How do they handle unauthorized sellers? Do they have a process for monitoring and enforcing your MAP policy? Do they coordinate with your legal team on IP complaints? Brand protection is not a nice-to-have; it is a core function of authorized distribution.
Ask About Scalability. Can they handle your catalog growth? What about seasonal volume spikes? Do they have the warehouse capacity, team depth, and systems to scale with you without service degradation?
Ask for References. Talk to other brands they work with. Ask specifically about communication, operational quality, and whether the partner does what they say they will do.
If you are a brand exploring partnership options for US marketplace distribution, request a Snapshot to see how we would approach your catalog and what the operational plan would look like. Or apply directly if you are ready to start the conversation.
When a Reseller Makes Sense
The reseller model is not always wrong. It works in specific contexts:
- Liquidation. If you have excess inventory that needs to move quickly, a reseller can clear it without the brand investing in marketplace operations.
- Market Testing. If you want to gauge demand in a new category or marketplace before committing to full operations, a small reseller relationship can provide signal.
- Low-Priority SKUs. If you have tail-end SKUs that do not justify full operational investment, resellers can maintain availability without the brand's direct involvement.
But for core catalog, hero SKUs, and any product that represents the brand's identity on the marketplace, the distribution partner model is the right choice. The operational depth, accountability, and alignment of incentives create a foundation for sustainable growth that the reseller model simply does not provide.
To learn more about how Oxalis structures distribution partnerships, visit our distributor partnerships page or get in touch to discuss your specific situation.
FAQ
What makes a distribution partner "authorized" versus just another reseller?
Authorization means the brand has formally designated the partner as an approved seller, typically through a written agreement that covers pricing, brand standards, territory, and operational expectations. This authorization gives the brand legal standing to enforce against unauthorized sellers and gives the partner the documentation needed to resolve listing disputes, Brand Registry issues, and marketplace policy questions. A reseller may or may not have any formal relationship with the brand.
How do I know if my current reseller is hurting my brand on the marketplace?
Look for three signals: pricing below your MAP or desired sell price, listing content that does not match your brand standards, and customer reviews that reference shipping or packaging issues you did not cause. You can also check if your product listings have multiple sellers on the offer page. If you see sellers you do not recognize, your distribution is not controlled, and your brand experience is not either.
Can I transition from a reseller model to a distribution partner model without disrupting sales?
Yes, but it requires planning. The transition typically involves onboarding the distribution partner while the reseller relationship is still active, building new listings or transferring listing ownership, and coordinating inventory so there is no gap in availability. The transition period usually takes 30 to 60 days for a small catalog and up to 90 days for larger ones. The key is to have the operational handoff mapped out before making any changes.
What should I expect to pay for a distribution partner versus a reseller?
Resellers typically buy at wholesale, often 40 to 50 percent below retail, and keep whatever margin they make after marketplace fees. Distribution partners usually work on a revenue share or a transparent cost-plus model, with the brand retaining more of the retail margin but paying for the operational services. The net economics depend on the category, price point, and volume, but brands typically retain 10 to 20 percent more margin with a distribution partner while getting significantly more value in operations, data, and brand control.