Sony is one vendor that is surprised and dismayed to find its products appearing on the new Amazon.com electronics site.
Bob Weissburg, senior VP of strategic sales planning for Sony Consumer Products, adamantly denied the company has sold any product to Amazon.com.
"We still maintain our authorized dealer agreement concerning online sales forbidding the practice," he stated. "We were as surprised as anyone about Amazon.com. We don't sell them. They must be buying off the street or receiving transshipments [from other dealers]. In those cases, supplies are inconsistent, and the models available change rapidly."
The industry is watching Sony very closely to see how it will handle online sales. Weissburg told TWICE that Sony will be issuing an online sales policy within 30 days.
Both Weissburg and Amazon.com electronics' general manager Christopher Payne did not comment regarding whether Sony has had direct discussions about the products sold on the site.
However, Weissburg issued a warning to those dealers that might be transshipping Sony product to Amazon.com or any other retailer. "We intend to tighten our distribution policies," he said. "If dealers transship to anyone but end users their dealer agreements will be in jeopardy. We will be extremely aggressive in maintaining this policy."
When asked if Sony's appearance on Amazon.com has caused problems for the manufacturer with its existing retailers, Weissburg said, "We have received some phone calls from our dealers since Tuesday [July 13], basically confirming that we haven't changed our distribution policies."
Amazon.com electronics' Payne did not comment about specific lines it is carrying, except to say that the site bought inventory "direct from manufacturers or from independent distributors." He added, "We want to work closely with vendors. This is a great channel that can be a very profitable one" for the industry.
One executive who did say that his company is shipping directly to Amazon.com is Uniden senior VP John Harris. However, he noted, "We are going to take it very slowly. We want to make sure this is what we want to do and that this is the way to do it."
Harris added, "There is obviously a lot of e-commerce in the world now, and we continue to evaluate it. We understand it will continue to grow, but we don't want to jeopardize our retailer relationships."
That is the main concern of most CE vendors, who have said all year that they are still developing strategies for e-tailing. When contacted by TWICE, manufacturers were surprised, or closed-mouthed, that their products appear on the Amazon site. The implied fear is that any full-blown entry into e-tailing - either through sites such as Amazon.com or their own sites - will infuriate their existing brick-and-mortar retail distribution base.
Among the CE vendors who spoke with TWICE on the record were Sharp and JVC of America. A spokesperson for Sharp said its products are appearing, "due to sales by an independent distributor." A JVC of America spokesperson emphasized that the company is not pursuing online sales, saying, "Our priority is still our current retail channel."
Bob Lawrence, executive director of Associated Volume Buyers, whose buying group launched its own site this year called BrandSource.com, was told by Sharp and Panasonic that they did not sell direct to Amazon.com. Surprisingly, Lawrence said AVB has "encouraged our suppliers to sell online, direct to consumers. But let us fill the orders." Maybe that's a way for the vendors to keep their brick-and-mortar retailers happy.