Crossover Businesses

Blurring of the Lines Between Manufacturers, Distributors, and Retailers … Changes Everything in the Process

Published March 2019

report-crossing-traditional-businesses

It is no secret that the old clear distinctions between manufacturers, distributors, and retailers have been obliterated. Manufacturers are increasingly selling direct to the end customer (consumers, businesses, or both) via the web, or in some cases with their own bricks and mortar stores (such as Apple, Nike, Goodyear, Ralph Lauren, Sony, Hugo Boss, Tesla, Kenneth Cole, and many more).

Wholesalers are also selling direct to end customers and as well broadening their services to include light assembly and manufacturing and in some cases offering their own branded product lines. Meanwhile, retailers are increasingly relying on private label products to generate margins and loyalty, essentially taking on the role of a brand owner, managing outsourced manufacturing. (For example, Target is launching 12 new private label brands this year).

This trend has been going on for many years, but has been gathering momentum with the accelerating adoption of ecommerce and omnichannel business models. In this paper, Chainlink Research explores what happens when a business crosses over to become a combination manufacturer, wholesaler, and retailer—how it impacts partnerships, services, revenue models, and the business’s system requirements.

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