I actually read an article on how Diapers.com got started. It was a couple folks in a garage. P&G and the other diaper manufacturers wouldn't talk to someone so small, so they got warehouse club memberships and just bought mass quantities to mail out.
At times, they apparently bought out the BJs and Sams Clubs within a 100 mile radius. They were doing it all on credit cards in their own cars and rented U-Hauls.
Two of my cousins own a vending machine business and for certain products they do the same thing (buying out Sam's Clubs). Why? Sam's Club volume is so much higher than theirs that even after Sam's Club tacks on their markup, it's cheaper for them to buy through them than to go to the manufacturer. It's always funny to go on these shopping trips with them, the look on a cashier's face when you have thousands of dollars of candy is priceless.
At times, they apparently bought out the BJs and Sams Clubs within a 100 mile radius. They were doing it all on credit cards in their own cars and rented U-Hauls.
Here's the article: http://www.bloomberg.com/news/2010-10-07/diapers-com-takes-o...