jason.kennedy.98478
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Any one else think MAP requirement by vendors is anti competitive and violation of federal anti trust and RICO statutes? Or is it just me?
Food for thought
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jason.kennedy.98478
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Not according to the FTC yo
https://www.ftc.gov/tips-advice/com...itrust-laws/dealings-competitors/price-fixing
https://www.ftc.gov/tips-advice/com...itrust-laws/dealings-competitors/price-fixing
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jason.kennedy.98478
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Right and they are excluded because say BRS or MD wouldn't be able to sell the items any more of they applied the sale to them. Unless the manufacture enforcing the MAP allows then too
NeuroticAquatics
Valuable Member
It’s that way with many products in many industries, not just aquaria. Used to frustrate me when I had an online business selling car stuff, but I understood where the manufacturers were coming from.
NS Mike D
In the arena.
MAP is not the same as minimum price and are usually tied to advertising agreements where the manufacturer is proving advertising dollars to the re-sellers. The re-seller is free to sell below the MAP and you will know this when the ad says to call for the price.
MAPs are not automatically in compliance with anti-trust and other regulations, as the devil is in the detail of how they are structured and administered.
MAPs are not automatically in compliance with anti-trust and other regulations, as the devil is in the detail of how they are structured and administered.
Crashjack
Well-Known Member
I would say it increases competition. Local store owners can’t compete when customers come in and try-out or try-on a product, get all their questions answered, take-up the store’s staff time; then they go home, order online, and get the same product shipped to their door for less money. Without setting a minimum price, manufacturers are exposed to having fewer retailers selling their products, which leaves them at the mercy of the few retailers.
I’m all for free trade but retailers are free to purchase and sell the products they want. If they don’t like a manufacture’s pricing requirements, they don’t have to sell that manufacture’s products.
I’m all for free trade but retailers are free to purchase and sell the products they want. If they don’t like a manufacture’s pricing requirements, they don’t have to sell that manufacture’s products.
Blue Spot Octopus
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^^^^^ 2nd . This gives the retailers a chance at selling the products that people want. Bummer I had a flash sale at Dr F&S with 30% off I could not buy anything I wanted it was all MAP pricing. So yeah it can be a bummer as well.
OK, so I guess I should clarify my comment. What I meant was there is nothing anti-competitive about a minimum price determined by a single seller. The document you posted addresses price fixing among competitors to control the market. MAP is not an agreement among competitors to fix the price. It is a dictate from either the manufacturer or the distributor that keeps the retailer from selling below a certain price. As @Crashjack said, it increases competition because it keeps larger retailers from selling the item so low the small guys can’t compete.
NeuroticAquatics
Valuable Member
It also keeps the little guys from selling products at a buck over their cost so that people don’t buy from the larger retailers.
Crashjack
Well-Known Member
I’m also a small business owner and agree... the little guy wouldn’t sell at $1 over cost. Think about it, a small local retailer with storefront has very high overhead as a percentage of what he can reasonably generate in sales. Compare that to a huge warehouse in the middle of nowhere that has a few people picking and packing orders... not to mention unless that warehouse is part of a really big company, they aren’t collecting and filing sales taxes. This type of business can make a profit on low margins and by churning out a lot of volume, can blow the doors off the small local retailer. Hence, the large company can generate profit at a price point that would bankrupt the small local retailer.
lmm1967
Well-Known Member
The ones that want to stay in business won’t. But plenty startup businesses will.
A mom and pop startup, who wants desperately to turn a profit and 'get in the black', that utilizes this tactic is doomed for failure in short order. I would not sell anything at a $1 over cost to spite the big box guys.
Bmezz
Active Member
ok well first ill say WE ARE as a fellow penn stater!!
The law as you say is actually not broken with MAP--the antitrust laws require that each company establish prices and other terms on its own, without agreeing with a competitor. When consumers make choices about what products and services to buy, they expect that the price has been determined freely on the basis of supply and demand, not by an agreement among competitors. When competitors agree to restrict competition, the result is often higher prices. Accordingly, price fixing is a major concern of government antitrust enforcement.
Each company sets their own MAP price.. if for example Ecotech discussed prices with Kessil and they set prices togeather that would be collusion. but assume that does not happen.
I hate MAP because companies from giving us deals... but what can we do as consumers-- its always who u know. So buddy up to the LFS owner and maybe get some wholesale prices!
For the Glory.....
The law as you say is actually not broken with MAP--the antitrust laws require that each company establish prices and other terms on its own, without agreeing with a competitor. When consumers make choices about what products and services to buy, they expect that the price has been determined freely on the basis of supply and demand, not by an agreement among competitors. When competitors agree to restrict competition, the result is often higher prices. Accordingly, price fixing is a major concern of government antitrust enforcement.
Each company sets their own MAP price.. if for example Ecotech discussed prices with Kessil and they set prices togeather that would be collusion. but assume that does not happen.
I hate MAP because companies from giving us deals... but what can we do as consumers-- its always who u know. So buddy up to the LFS owner and maybe get some wholesale prices!
For the Glory.....
Crashjack
Well-Known Member
Exactly. If a small business sells product at $1 over cost, they won’t stay in business and should have never gotten in business in the first place. Obviously, we are talking about products with some significant cost. If a product cost $.50 and the store owner sold for $1.50, that would generate a 67% margin, which in most small businesses is very good. However, even if a product cost just $10, selling at $11 would generate only a 9% margin, which in any small retail business is stinko.
Crashjack
Well-Known Member
Well you are quite welcome.
