SDN

 An SDN is the operational structure created to enforce and maintain a Selective Distribution Agreement.
It defines who is allowed to sell, under what conditions, and in which channels or territories - ensuring that only trusted and qualified resellers represent the brand both online and offline.

Purpose of an SDN:

• To protect brand integrity and maintain consistent customer experience.
• To control distribution channels and prevent unauthorised reselling.
• To ensure compliance with brand presentation, service, and pricing policies.

Key Elements of a Selective Distribution Network:

1. Authorised Distributors:
   • Must meet brand-defined standards (e.g., staff training, technical expertise, store quality).
   • Often limited to a specific region or channel (e.g., premium offline retailers, authorised e-commerce partners).
2. Online Channel Governance:
   • Defines rules for selling on marketplaces like Amazon - often limiting participation to pre-approved sellers.
   • Helps brands enforce SBSAS (Standards for Brands Selling in the Amazon Store) and IP protection policies.
3. Monitoring and Compliance:
   • Brands actively monitor listings, pricing, and presentation.
   • Non-compliant sellers can be removed from the network or reported for IP violations.
4. Territorial or Product Scope:
   • SDNs may be region-specific (e.g., EU, North America) or product-specific (e.g., high-end electronics or cosmetics).

Example in Amazon Context:
A luxury haircare brand operates an SDN of 20 authorised distributors across the EU.
Only these partners are permitted to list products on Amazon under the brand name.
Unauthorised sellers are removed via Amazon’s Brand Registry and SDA enforcement mechanisms.

Benefits for Brands:

• Consistent brand presentation: Unified messaging and imagery across sales channels.
• Controlled pricing: Easier enforcement of MAP (Minimum Advertised Price) policies.
• Customer satisfaction: Guarantees authentic, high-quality buying experiences.
• Counterfeit prevention: Reduces unauthorised listings and parallel imports.

Benefits for Amazon:

• Catalogue integrity: Ensures accurate, compliant listings.
• Trust and quality: Promotes legitimate, authorised brand experiences.
• Regulatory compliance: Aligns with EU competition and distribution laws.

Challenges:

• Legal restrictions: Must comply with EU and national competition law (e.g., Article 101 TFEU).
• Enforcement difficulty: Policing third-party marketplaces can be complex.
• Limited flexibility: Too narrow a network may reduce availability or sales potential.

Why It Matters:
An SDN allows brands to maintain control and consistency while leveraging Amazon’s reach.
It protects premium positioning, ensures compliance with selective distribution laws, and preserves customer trust.

Example:
A high-end espresso machine brand builds an SDN of certified resellers who meet display, service, and training standards.
Only these distributors can sell the brand’s products on Amazon and other marketplaces, ensuring consistent quality and pricing.

In short:
SDN (Selective Distribution Network) is the authorised ecosystem of distributors and resellers operating under a Selective Distribution Agreement (SDA) - ensuring brand protection, quality control, and consistent representation across Amazon and other sales channels.