How do we sell direct to professional consumers from our website and not upset our existing “wholesale customers”? The wholesale business has dropped by 20% this year with more and more prosumers wanting to buy our custom frame products.

The Harvard MBA says:

Channel conflict is a very real issue for a lot of companies, especially because of the rise of the Internet.  The traditional role of the channel was to cover specific markets and provide end-user support.  The Internet changed all this, allowing manufacturers to sell directly over the Web.

Unfortunately, it’s difficult to start selling direct without upsetting your existing wholesale partners.  Rightly or wrongly, they will perceive this as bad for their business.  The best you can do is minimize the channel conflict.

A lot depends on the specific circumstances.  For example, what markets do your wholesalers cover?  If your wholesalers focus on true consumers, and the prosumer business is only a small part of their revenues, you may be able to explain to them why your direct-to-prosumer sales won’t interfere with their main business.

Alternately, you may be able to involve your channel partners in your prosumer business.  Perhaps the prosumers buy the products directly from your Web site, but are referred to your channel partners to purchase support and customization services.

Either way, be careful about taking risks with your main business.  It’s human nature to be overly optimistic about new businesses.  Proceed incrementally and avoid doing anything that would pull the plug on existing sales until you have clear indications of success.