What Distribution Really Costs

What you trade, what you gain, and why the real price sits beneath the surface

So this is day 29, and we are talking about the costs of distribution. I think the cost of distribution is always interesting because there are the ones you see and the ones you never see coming.

Apart from the obvious cases where you pay directly, there are the internal costs that slip into the background. Engineers need to get paid. Marketers need to get paid. The team needs time. Time is one of the biggest costs in distribution. It takes time to build, to align, to review, to test, and to push things forward. Time also has its own hidden price. You could have been doing something else with that time.

There is a term in business that sits close to this, Opportunity Cost. The idea is simple. When you choose one direction, you are giving up another. It does not mean the decision is wrong or right. It only means you should weigh what you are losing against what you stand to gain. Distribution works the same way. The time you spend negotiating, planning, and integrating could have been spent on a different lever. That is part of the cost.

Then there are the invisible costs. The tiny things that never show up on a spreadsheet at first. You spend time getting approvals. You spend time getting technical alignment. You negotiate how visible you will be in the interface. You sometimes give up control over parts of the message or parts of the experience. You are depending on another team, another company, another road-map. If they slow down, you slow down. Their pace becomes your pace.

There are also costs that grow with scale. Maybe you pay for API calls or credits. As you grow, the volume increases. Scale does not always create savings. Sometimes scale becomes expensive. That is why you always keep an eye on marginal cost and how it shifts as your channel grows.

On the surface, it can feel like the marginal cost of reaching a new user is close to zero. The truth is that most of the work sits at the beginning. The negotiations, the integrations, the alignment, and the setup take the bulk of the effort. Later, the channel might become costly again if the partner changes pricing, tightens policies, or introduces limits that did not exist before.

All of these are part of the real cost of distribution. Some costs are loud. Some costs hide. Together, they shape the true price you pay to build through someone else’s platform.

That is all for day 29. I will see you tomorrow for the final edition.