I make widgets, and contract with you to sell my widgets exclusively in some geographic region. Then I start selling my widgets on my website, and people from your region start buying things via my site.

We have a channel conflict.

They happen in other ways as well.

Thx. So how does Costco manage this?

Often by selling Costco specific versions of things. For example, Google Wifi is normally available in 1 packs and 3 packs, but Costco offers a 4 pack. It's literally just a 1 pack and 3 pack put into a bigger box, but it sells for $299 vs the 3 pack at $259.

Yes this specifically I bought the 4 pack and it was weird that it was packaged 3 & 1