Most founders we talk to use the word “authorized” interchangeably with “I can buy this from somewhere.” That is a problem. There are three categories of supply that look identical from the outside but behave radically differently when something goes wrong, when a marketplace audit happens, or when a brand changes their distribution policy.
1. Authorized Distributor Status
This is the strongest position. The brand has signed a formal agreement with a distributor that holds rights to import, warehouse, and resell their goods within a defined territory. When you purchase through that distributor, you are operating inside the brand’s sanctioned supply chain. Marketplaces accept these invoices as proof of authenticity. The brand’s legal team will not pursue you. Returns and warranty claims work normally.
2. Brand Authorization Letter (Reseller Status)
One step down. The brand or its authorized distributor has issued you a written letter confirming you are an approved reseller. This is what marketplaces like Amazon and bol.com require for gated categories. The letter is specific: a brand, a marketplace, sometimes a country. It expires. It does not give you the same protections as direct distributor status, but it lets you operate legitimately.
3. Grey Market
Genuine product, but acquired outside authorized channels. A wholesaler in another region sold it on. A retailer liquidated stock. A distributor moved excess inventory through channels they should not have. The product is real. The supply is unstable. The brand will not stand behind it. Marketplaces flag it. This is where most “supplier list” businesses operate without realizing it.
How to verify what category you are in
Ask three questions before placing your first order with any supplier:
- Can you provide an authorization letter from the brand naming my company?
- What happens to my supply if the brand changes their distribution policy next year?
- If a marketplace audits my listings, what documentation will you provide?
If those three questions get vague answers, you are in grey-market territory. That can still be a workable business, but you need to price the risk in.