MAP Pricing

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DavidZ

DavidZ

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I know that there have been a few threads discussing this policy of minimum advertised pricing. However, the question I have that has not been answered is..... just because a certain manufacturer has imposed MAP pricing for their products, does not mean that they cannot be sold for less. They just cannot advertise a lower price. They can give it away if they want. Has anyone attempted to get a knife from one of the internet retailers for less than the advertised price? I just have, and they said that contractually cannot sell it for less. If that is true, that would be price fixing, which is illegal. In this case, I am sure the retailer was just hiding behind the manufacturer and making them the bad guy. Is my logic wrong? If no one requests a lower price, than it really amounts to price fixing. What say you my forumites?
 
I'm very confused as to why you put this in the Community Center.

As for price fixing, not necessarily. That would be if multiple knife companies teamed up and agreed to artificially inflate their prices by all selling at an agreed upon minimum.

That said, I loathe MAP and generally try to avoid purchases from companies that institute a policy like that.
 
Spyderco are the only ones I cannot find below map online. But I've got zt, Kizers and Benchmades below map .. Usually in a private sale but not advertised. I've got some below map on ebay from legit dealers by winning an auction (sniping the last bid).

Some retail stores may give you lower also. you'll have to work with them on that. They may not go below map either.

Ive asked some online stores to go below map and they won't budge.

If you have a relationship with a store they may work with you. Buy all your knives from them, they may give you a loyalty discount.
 
DavidZ said:
I know that there have been a few threads discussing this policy of minimum advertised pricing. However, the question I have that has not been answered is..... just because a certain manufacturer has imposed MAP pricing for their products, does not mean that they cannot be sold for less. They just cannot advertise a lower price. They can give it away if they want. Has anyone attempted to get a knife from one of the internet retailers for less than the advertised price? I just have, and they said that contractually cannot sell it for less. If that is true, that would be price fixing, which is illegal. In this case, I am sure the retailer was just hiding behind the manufacturer and making them the bad guy. Is my logic wrong? If no one requests a lower price, than it really amounts to price fixing. What say you my forumites?
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It really is Minimum Advertised Price (agreement between wholesale and retail), but a retailer is always free to sell at whatever price they wish...or something like that in the agreement, has to be like that to avoid "Price Fixing" per se. I think the retailer doesn't want to sell it for less and just using an excuse, although that excuse uttered by many many retailers can ultimately get a manufacturer in trouble. The saving grace is the handful of days or just 1 day a year where every retailer goes on sale at once, again usually in these MAP agreements. This is why big home appliances (i.e. Kitchen aid, etc..) and apparel brands (Levi's, Polo, etc) seem to be on sale everywhere as the agreement lets them all advertise for less during certain periods.
 
If you're talking about the policies of companies like KAI, Benchmade, Spyderco, etc., its's actually a combination of MAP and the Colgate Doctrine. Colgate is the practice whereby the manufacturer announces the minimum prices at which its products can be sold and refuses to do business with anyone who won't agree to that. That is a lawful practice and isn't a violation of the federal antitrust laws.
 
Insipid Moniker said:
I'm very confused as to why you put this in the Community Center.

As for price fixing, not necessarily. That would be if multiple knife companies teamed up and agreed to artificially inflate their prices by all selling at an agreed upon minimum.

That said, I loathe MAP and generally try to avoid purchases from companies that institute a policy like that.
Click to expand...

I wasn't sure where to post it, but there was a thread regarding paypal policies, so this seemed like a manufacturers policy, so here it went.
In this case, there are multiple companies that require MAP pricing. The individual retailers are not conspiring to fix prices, the manufacturer is doing it for them. The results are the same.
 
Mo2 said:
Spyderco are the only ones I cannot find below map online. But I've got zt, Kizers and Benchmades below map .. Usually in a private sale but not advertised. I've got some below map on ebay from legit dealers by winning an auction (sniping the last bid).

Some retail stores may give you lower also. you'll have to work with them on that. They may not go below map either.

Ive asked some online stores to go below map and they won't budge.

If you have a relationship with a store they may work with you. Buy all your knives from them, they may give you a loyalty discount.
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I too have asked online retailers to go below MAP, with no success.
 
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HappyDaddy said:
If you're talking about the policies of companies like KAI, Benchmade, Spyderco, etc., its's actually a combination of MAP and the Colgate Doctrine. Colgate is the practice whereby the manufacturer announces the minimum prices at which its products can be sold and refuses to do business with anyone who won't agree to that. That is a lawful practice and isn't a violation of the federal antitrust laws.
Click to expand...
Thanks for the tip about the Colgate Doctrine. That is something that I did not know about. I will have to research that.
 
Moved to General knife discussion. We do not discuss knives in Community.
 
i thought price fixing has to be multiple manufacturers conspiring to price increases and or prices in general. one refusing to sell below a certain dollar amount can t be considered price fixing, I dont believe.

If what the reseller said is true....I'm not sure that is legal either without a range given by the manufacturer. although im no lawyer so maybe they can dictate absolute prices or else. course in this case possible everyone may be at the bottom of the range already.
 
My question is; what do you do for a living and what kind of online discount are you offering us?
 
When selling knives from companies that you have agreed to do their MAP (pricing), then in most cases, the listed price IS the price. But it depends on the manufacturer/retailer agreement. I think if you are seeking a price below MAP, then I would suggest you do the shopping in person.
 
jbmonkey said:
i thought price fixing has to be multiple manufacturers conspiring to price increases and or prices in general. one refusing to sell below a certain dollar amount can t be considered price fixing, I dont believe.

If what the reseller said is true....I'm not sure that is legal either without a range given by the manufacturer. although im no lawyer so maybe they can dictate absolute prices or else. course in this case possible everyone may be at the bottom of the range already.
Click to expand...

It is illegal for wholesalers, manufacturer to dictate pricing to retailers, although they can incent "advertising prices" through kickbacks or other incentives a retailer would lose if they advertise below the threshold outside of an allowed window. The affect is very similar to the consumer, but retailers are always allowed to price however they want. On the subject of Colgate Doctrine, a wholesaler/manufacture can do business with whoever they choose, but......A wholesaler/manufacture that pulls product from a retailer based sales price would be a punitive action based on pricing, therefore fitting the definition of illegal price fixing. "Price it this way or else" is price fixing pure and simple. Very hard to get away with in the instant information age we are in, although before the internet, was much easier, albeit could only shop locally in catalogs so didn't matter much.

In practice if you walk into a shop carrying product under map pricing they can sell at any price they want, but the signs on the products, store windows, print/radio/online advertisements and the like would most likely not break map pricing outside the allowed window. Could you ask the shop owner for a better price, sure, does he/she have to give it, certainly not, regardless of any map pricing agreements he/she is under.
 
DavidZ said:
I know that there have been a few threads discussing this policy of minimum advertised pricing. However, the question I have that has not been answered is..... just because a certain manufacturer has imposed MAP pricing for their products, does not mean that they cannot be sold for less. They just cannot advertise a lower price. They can give it away if they want. Has anyone attempted to get a knife from one of the internet retailers for less than the advertised price? I just have, and they said that contractually cannot sell it for less. If that is true, that would be price fixing, which is illegal. In this case, I am sure the retailer was just hiding behind the manufacturer and making them the bad guy. Is my logic wrong? If no one requests a lower price, than it really amounts to price fixing. What say you my forumites?
Click to expand...

I think your understanding of MAP is correct. I believe some dealers (not all dealers) are just purposely misleading customers by saying the MAP prices cannot be negotiated on a individual basis. It would be fine with me if they instead simply say no - we do not negotiate prices with our customers.
 
MAP is a tool, and not wholly bad nor good. It's all in how it's applied. It greatly assists in growing distribution because it establishes a minimum margin to the retailer so that the big guys in the market who can afford to sell puny amounts above wholesale cost for the sake of being market price-leaders aren't able to just scoop up all the sales. This makes a retailer feel that the product is a safe investment for them. However, if MAP is set too high, it can impact the competitiveness of the product negatively, especially depending on the company's market positioning. I feel that Spyderco has implemented MAP well, as it's pretty low. Condor, on the other hand, has set the MAP bar too high. Their positioning as a value brand is kind of confounded by their insistence on high MAP. It's the reason why I switched to offering all of my Special Grade work on Condors for free, to offset the value ratio, but most other retailers aren't in a position to do something like that.
 
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