Proprietary lock-in of the wrong thing

If you attempt to lock up proprietary items, e.g. a well-known brand of clothing, by becoming a middleman to supply that proprietary item, when you don’t have exclusive distribution rights, you will lack what is commonly known as a “sourcing advantage.”

Your sourcing advantage is that you can get more of the product than anyone else, even if there is a supply shortfall across the vertical, and sell it cheaper than anyone else all the time.

Amazon is an extreme example where they either don’t care because they are big enough (now) or they can artificially induce a sourcing advantage (because they are big enough (now)).

Pets.com is the prime example of lacking a sourcing advantage.