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Why should they reach out to you to sustain your monopoly? Because that's what you really want to do, right?

I once worked in retail (apparel) where it is very common for manufacturers to grant individual companies exclusive wholesale rights to entire markets, i.e. a country, multiple countries, or sometimes even continents. Any other company would have to go through these wholesalers to purchase products. Anyways, whenever we came across a wholesaler that didn't have their act together - refusal to sell products, having cheaper prices for their own retail arm, unfair terms, etc - we would make a formal complain to the manufacturer and let them know why their products were doing so poorly on the market. More often than not, we ended up with getting wholesaler rights, making us completely independent. Similarly, if your competitors can show that you are damaging their sales with anti-competitive actions, they will be very quick to react, even going so far to remove your exclusive rights.



If we are satisfying our contractual obligation, and shipping what the clients want, how could a competitor make a case using "damaged sales"? Isn't that like saying that I start a cola company and say Pizza Hut is damaging my sales by selling only coca-cola?

In your retail example it makes sense when the wholesaler did not have their act together, but we do, and we are doing a good job.


Whether you are satisfying the terms and conditions of your contract is secondary. A contract is there to codify the most basic rights and obligations and generally says nothing about excellence, growth and value. If a competitor really wants a piece of your cake - which I assume several actually want since it seems lucrative - they could establish the perception that you are not creating enough value/growth for the licensor.




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