Not exactly my field, but my understanding is that large retailers sometimes do do outsourced product development roughly similar to this post's suggestion. Typically, that is a result of someone in direct sales building a monstrously successful product (relative to other direct sales items), then using that as leverage to get the chain to stock it on terms which are more favorable than their usual ones. (Consumer electronics manufacturing is a tough market, kiddos, and the folks who control the distribution channels very aggressively remind you that if you don't give them very favorable terms and also pay them for pushing your product then they will find someone who will.)
If you've got something which is profitable in direct sales but is not yet a monstrous brand name, it doesn't make sense for you to sell to Best Buy (why serve in heaven when you can reign in... wait, this doesn't work if heaven is Best Buy) and it doesn't make sense for Best Buy to buy you, because you're probably selling something that a Chinese factory can produce in a functionally equivalent fashion for 1/3rd the price.
The asset is the brand/proven distribution channel. (That's why e.g. Magic Bullet survives when you can get functionally equivalent food processors for less literally adjacent to it in the store. The functional equivalents have higher margins and would have displaced the Bullet but for the Bullet being the customer favorite due to, well, really good infomercials.) Best Buy doesn't really want to buy that from you, because you'll peg the price to the existing distribution channel that you own which they have no desire in.
Too many people confuse distribution and product development.
While I laud the OPs suggestion that retailers like Best Buy might be more competitive if they could source products that Amazon cannot, there is an existence proof for this called "Pier 1 Imports" whose "special sauce" consisted almost entirely with seeking out niche suppliers, locking up a retail relationship with them, and putting their stuff into stores. Great for craft kinds of things but not so much consumer electronics.
Now if you want to go so far as to say there is an emergent market for 'craft' electronics (and there is some evidence on Kickstart to suggest this looking that the Blink project for example) then perhaps what should really be the point is to create the 'Pier 1' of those electronics. The seeds of that would seem to be in Makershed.
The way I understood the article is that BB (would) buy these small companies out (and thus lock up the distribution and lock out the Amazons of the world).
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Not exactly my field, but my understanding is that large retailers sometimes do do outsourced product development roughly similar to this post's suggestion. Typically, that is a result of someone in direct sales building a monstrously successful product (relative to other direct sales items), then using that as leverage to get the chain to stock it on terms which are more favorable than their usual ones. (Consumer electronics manufacturing is a tough market, kiddos, and the folks who control the distribution channels very aggressively remind you that if you don't give them very favorable terms and also pay them for pushing your product then they will find someone who will.)
If you've got something which is profitable in direct sales but is not yet a monstrous brand name, it doesn't make sense for you to sell to Best Buy (why serve in heaven when you can reign in... wait, this doesn't work if heaven is Best Buy) and it doesn't make sense for Best Buy to buy you, because you're probably selling something that a Chinese factory can produce in a functionally equivalent fashion for 1/3rd the price.
The asset is the brand/proven distribution channel. (That's why e.g. Magic Bullet survives when you can get functionally equivalent food processors for less literally adjacent to it in the store. The functional equivalents have higher margins and would have displaced the Bullet but for the Bullet being the customer favorite due to, well, really good infomercials.) Best Buy doesn't really want to buy that from you, because you'll peg the price to the existing distribution channel that you own which they have no desire in.
This.
Too many people confuse distribution and product development.
While I laud the OPs suggestion that retailers like Best Buy might be more competitive if they could source products that Amazon cannot, there is an existence proof for this called "Pier 1 Imports" whose "special sauce" consisted almost entirely with seeking out niche suppliers, locking up a retail relationship with them, and putting their stuff into stores. Great for craft kinds of things but not so much consumer electronics.
Now if you want to go so far as to say there is an emergent market for 'craft' electronics (and there is some evidence on Kickstart to suggest this looking that the Blink project for example) then perhaps what should really be the point is to create the 'Pier 1' of those electronics. The seeds of that would seem to be in Makershed.
>Now if you want to go so far as to say there is an emergent market for 'craft' electronics
You can also check out: https://www.tindie.com/
But Amazon has Marketplace and 3rd-party sellers, so how could Best But get any product that Amazon cannot?
The way I understood the article is that BB (would) buy these small companies out (and thus lock up the distribution and lock out the Amazons of the world).