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How Small Retailers Get Big Brands to Trust Them

I am writing my business plan for a soccer-and-rugby store but I’m puzzled about buying inventory. Opening accounts with manufacturers like Nike or Adidas (ADS:GR) looks very difficult; certain requirements need to be met first. Where does a brand-new store get inventory to open its doors? —J.S., Ashland, Ore.

Choosing and stocking inventory is one of the significant hurdles for new retailers, especially if they want to sell well-known brands, which can be choosy about who carries their top lines. “Part of the reason the big guys make it so tough is that they don’t want new stores to open with low-ball pricing, erode their main distributors’ margins, and then go out of business 18 months later—having torched their brand’s pricing,” says retail consultant Bob Phibbs.