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I'm making a product, and selling mostly online.

I was shocked (in the newbies do) to find out about the sort of gross margins retailers want. From where we are now, it seems like the only way we could reach that is through economies of scale that we are uncertain would pay off. Chicken meets egg once again?

In the market we're in (musical instruments/audio) the retailers with stores are going away, sales have moved online.

I'm not sure yet but I think the margins for online retailers could be less?

Look at how much money online retailers make, after their costs their profit margins are mostly single digit meaning they don't have a lot of room to cut costs. Also if retailers can wring profits out of you they will, online or offline.

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