Cypress, Calif. - Car electronics supplier
has been dropping distributors and direct dealers that have repeatedly transshipped products to unauthorized brick-and-mortar and online retailers.
The actions, which the company called "drastic," have "strengthened Clarion's brand and its business with the remaining authorized dealers and distributors," the company said.
"Our company has made a significant effort to track, monitor and eliminate transshipping and unauthorized sales, whether brick and mortar or over the internet," said president Tom Hayashi. The industry, he added "cannot continue to allow this practice to happen." Since early this year, the company dropped 10 dealer or distributor accounts, and other warning letters are outstanding, a spokesperson said. If those companies don't take action within a certain time span, the spokesperson added, "They will be getting a termination letter."
Clarion has also notified its distribution network "of not only the benefits of this activity but also the consequences of violation, including termination of business," the company added.
The company said it has been strengthening its relationship with authorized dealers by promoting its dealer support extranet, TeamClarion.com; offering Authorized Clarion Dealer stickers; and emphasizing product training.