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someone explain this, please...(6 posts)

someone explain this, please...mohair_chair
Dec 12, 2002 9:49 AM
Today I saw a two-page 2-color ad in the newspaper with lots of hot gadgets, some of which I want. The problem is that some of the gadgets have prices and some don't. Each one that has no price says instead, "Call."

WHY?

I see this all the time, and all it does is guarantee that they won't be getting my business. I'm not going to call. I'm not going to wait on hold listening to muzak or sales pitches or whatever just to beg them to tell me how much. I'm not going to drive down there and see for myself, either. What are these idiots thinking? SHOW ME THE PRICE!
Can't explain all of it but.......Len J
Dec 12, 2002 10:10 AM
I know that some suppliers will only give pricing to a retailer if he commits to not publish his sell price & create a bidding war.

Len
Another reason...Silverback
Dec 12, 2002 10:18 AM
This happens more in magazines, with their long lead time, than in newspapers, but it's pretty common to advertise things the store doesn't have yet but expects to get. They may not know when they put the ads together how much they'll have to pay for the stuff. If they expect to pay $5, and advertise at $10, but then have to pay $7, their profit disappears.
With the huge growth in national retailers (Home Depot, REI etc), even newspaper ads might be prepared weeks or months in advance. If they're not sure of their cost, they don't like to advertise one that might cost them money.
3 reasonsEager Beagle
Dec 12, 2002 11:50 AM
1) Their supplier has agreed to supply the seller, but the price isn't fixed; and/or

2) The seller wants to judge demand to see what they can get away with charging.

3) There has been a product flooded onto the market, and everyone is watching everyone elses' price.

Typical response on calling - "what's the best price you have been offered" or a go in high, then a "I can do you a special deal so that you are not disappointed" line, yadayadayada.

Solution: Shop around a bit, go in a bit low and see if they bite. Then raise a bit with a "I'm here now so I'll buy from you if you can do it for X" etc.

Capitalism in reality.
Avoidence of price-fixing laws,TJeanloz
Dec 13, 2002 12:14 PM
Manufacturers can't set hard and fast rules about how much a retailer can sell their products for. They can, however, restrict what price is advertised, especially if the manufacturer is contributing ad co-op dollars.

This happens in the bike industry all the time- it's not infrequent that you aren't allowed to advertise a price below a certain number for a current-year bike. The retailer can, however, sell the bike for whatever he wants. It's done really more to protect the dealer network than anything else.
Avoidence of price-fixing laws,raptorUW
Dec 14, 2002 3:44 PM
anyone out there an expert with regard to these laws? as far as i've been informed retail price maintenance - a manufacturer telling a retailer what prices to sell at - is illegal (sherman? act) with some lone exception coming via precedent set by the colgate case in the 1920's. i thought the colgate case said something to the effect that manufacturers can announce up front that they won't deal with discounters...but now that i think about it, i'm not sure how, if that was the case, RPM could be illegal.

so i guess here are my questions: can anyone explain exactly what the colgate ruling was? and how rpm could be carried out illegally in its presence?

btw, minimum advertised pricing (manufacturer contributes to co-op $$) is legal. fine line between it and rpm, i guess.

also, if in fact rpm is illegal, and happens all the time, why don't we hear about it more often? like i said above, most everything i have seen points to the fact that rpm is per se illegal; which would mean that any efficiency arguments (ie, protect ibd platform) are immaterial.