4 ms·

MRP and MAP mostly. Retailers usually have agreements with vendors to sell at the manufacturer's retail price and to advertise at the manufacturer's advertised

MRP and MAP mostly. Retailers usually have agreements with vendors to sell at the manufacturer's retail price and to advertise at the manufacturer's advertised price. This came out of a 2007 Supreme Court decision: Leegin Leather Products vs. PSKS Inc. I only know about this because I used to purchase a lot of cigars from a large volume discounter and they were forced to raise prices dramatically due to the outcome of that ruling. Pokemon cards are a gambling racket. No manufacturer is going to be happy with their direct customers raising the bar to entry on said racket.

shadowgovt 5y ago
MAP is a factor online too. Google Shopping, Amazon marketplace... All of them have MAP as an input field for data providers that describe products they make. In Google's case, it creates a floor on the value that Shopping will list for the price of a product (though you can sometimes find cheaper via a non-Shopping main page search, or by going through the main portal of an online retailer).
deleted 5y ago
[deleted]
Joker_vD 5y ago
In the USSR, when it still existed, retail prices were stamped on the items at the manufacturing plant, because of how stable the prices (and the economy in general) were. After the collapse, this practice had stopped entirely for obvious reasons. So the fact that such a thing as "manufacturer's retail prices" still exist, in the USA of all places, and that they apparently has some legal weight was a surprise to me. TIL.
- MisterBastahrd 5y ago
  Well, I guess you can consider a manufacturer to be either an actual manufacturing company that sells directly to wholesalers or retailers OR a company that owns a brand which purchases product in bulk to sell to wholesalers or retailers. Either way, a lot of companies want their products to be seen in a certain "class" of products, and it's harder to maintain that brand image from a pricing standpoint if everyone can just sell it at whatever they want. So, what happened at this large discount cigar place is that, like I said, they were doing something similar to Wal-Mart's strategy: sell a ton of product at a low profit margin and force manufacturers to come down in prices as a result. The manufacturers hated it because (a) their existence relied on the good will of this corporate behemoth, and (b) supplying so much product to the discounter meant less was available around the country for retail shops, which is essential to building brand loyalty. When Leegin happened, the discounter begrudgingly admitted that they would be forced to raise prices. But not before buying out a few accessory manufacturers. While not as popular as simply discounting cigars, it sorta worked for them. They would sell a box of cigars at the lowest price that they could and then include a free humidor to store them in. And what collector of stuff doesn't want another container for their stuff? I'll say too, that some manufacturers simply refused to do business with the volume discounter until after Leegin. They had built up a market for themselves with independent shops without needing to go to the volume discounter... but after they could be ensured that their prices would be stable, they opened the floodgates.
  - Joker_vD 5y ago
    > it's harder to maintain that brand image from a pricing standpoint if everyone can just sell it at whatever they want Does this apply to discounters only? The PS5 (and earlier, PS4) resellers are re-selling them at premium, but AFAIK Sony doesn't go after them, at all. > (b) supplying so much product to the discounter meant less was available around the country for retail shops ...don't supply to the discounter so much then? Don't the manufacturers usually supply the retail chains first and only then dump whatever left to the discounters anyhow?
    - MisterBastahrd 5y ago
      which resellers? I would have to imagine that anyone buying directly from Sony and marking up their products would catch the ire of the company, but maybe not. MAP and MRP are more about the downward pressure on prices, not upward, so that companies can't come back later and say "I can't sell your product and make a profit because I'm selling it for too cheap." The discounter largely doesn't care as much because of the sheer volume they were doing. They were selling at near half the price of what brick and mortar shops were selling AND this was during a time where most states were not charging taxes on internet purchases OR on tobacco sales. Say you have a box of cigars that has an MSRP for $100 a box. Break even price is $50. Discounter sells for $60 and offers free shipping. You go to the local store and buy for $100. Then you get hit with a 30% tobacco tax and a 9% sales tax. So now you're comparing $60 vs $139. Even if they didn't have what you want in stock, they probably would have something else you'd like for a fraction of the cost. Most mom and pop cigar stores carry about $50-200K worth of inventory at any one time. This discounter was doing mail order business and had about $80-100M worth of inventory.
- foobarian 5y ago
  I saw this in Prague in the 80s. Went to buy bread and the price was embossed in the loaf. "5 Kčs"
  - Joker_vD 5y ago
    "Inflation"? Pah, what a load of bourgeois nonsense. The bread costs 5 crowns, and had always costed that much since the last price reform in 1969.
- rsj_hn 5y ago
  The price policy just created shortages, so yes the item was stamped with a price, but unless you knew someone who owed you a favor or slipped the clerk something extra under the table, it would be hard for you to purchase it for that price. This also led to endless queueing, where standing in line was a full time job. It would not be uncommon to wait in line for a few hours when rumors spread that a particular store got some bread in, or that a butcher finally had some meat. This job was then assigned to grandmothers and others who did not have to show up to work -- to basically spend all day standing in line in front of various stores, hoping to come back with some groceries. That created an entire black market economy of side payments and private goods which were not stamped with a price, but the government tolerated this economy because they knew that without it, many household essentials could not be obtained. That normalization of bribes meant that if you had to go a doctor and wanted to be treated decently, a side payment was required. If your car broke down (although most people learned to fix most issues on their own) a side payment was required. If some apples became available and you wanted to get one, a little money or barter was needed. Maybe you had an uncle in the country who made some sausage, that could be exchanged for a dental visit in which anesthetic was provided. So the economy began to devolve to barter. If you were not good at politics and you had nothing to barter, life was pretty hard. I once traded a pack of sunflower seeds for private access to a UNESCO world heritage site. The friend of my uncle who was running the restoration (one of those eternal ongoing projects started in the 50s) unlocked the doors for me and let me crawl around the scaffolding. I was able to touch the frescos! But, you see, I had the desired sunflower seeds. This is portrayed beautifully in many underground books and even some mainstream books like Master and Margarita, where the main objective of everyone in the novel was obtaining an apartment in Moscow. Yes, those apartments were cheap, but available only to insiders or members of the nomenklatura. Hence the endless jockeying, politicking, and finagling to get onto various secret waiting lists or catch the favor of a government official who might in their beneficence put you on the right list.
- jpindar 5y ago
  When I was a kid, prices were printed on comic books and on paperback books in the US. I don't know when they stopped.
- colanderman 5y ago
  The USA's capitalist image aside, price tags per se are as American as apple pie, having been invented by Quakers, who found haggling/price discrimination immoral. They caught on in industry because they helped optimize the checkout process. [1] (Consumerism is arguably more strongly tied to the American identity than capitalism.) The concept of MSRP to me (as an American) is not too far removed from that of the price tag, which I guess makes it not too surprising to me that MSRPs are culturally normalized here. [1] https://en.wikipedia.org/wiki/Price_tag#History https://en.wikipedia.org/wiki/Price_tag#History

shadowgovt 5y ago

MAP is a factor online too. Google Shopping, Amazon marketplace... All of them have MAP as an input field for data providers that describe products they make. In Google's case, it creates a floor on the value that Shopping will list for the price of a product (though you can sometimes find cheaper via a non-Shopping main page search, or by going through the main portal of an online retailer).

deleted 5y ago

[deleted]

Joker_vD 5y ago

In the USSR, when it still existed, retail prices were stamped on the items at the manufacturing plant, because of how stable the prices (and the economy in general) were. After the collapse, this practice had stopped entirely for obvious reasons. So the fact that such a thing as "manufacturer's retail prices" still exist, in the USA of all places, and that they apparently has some legal weight was a surprise to me. TIL.

MisterBastahrd 5y ago
Well, I guess you can consider a manufacturer to be either an actual manufacturing company that sells directly to wholesalers or retailers OR a company that owns a brand which purchases product in bulk to sell to wholesalers or retailers. Either way, a lot of companies want their products to be seen in a certain "class" of products, and it's harder to maintain that brand image from a pricing standpoint if everyone can just sell it at whatever they want. So, what happened at this large discount cigar place is that, like I said, they were doing something similar to Wal-Mart's strategy: sell a ton of product at a low profit margin and force manufacturers to come down in prices as a result. The manufacturers hated it because (a) their existence relied on the good will of this corporate behemoth, and (b) supplying so much product to the discounter meant less was available around the country for retail shops, which is essential to building brand loyalty. When Leegin happened, the discounter begrudgingly admitted that they would be forced to raise prices. But not before buying out a few accessory manufacturers. While not as popular as simply discounting cigars, it sorta worked for them. They would sell a box of cigars at the lowest price that they could and then include a free humidor to store them in. And what collector of stuff doesn't want another container for their stuff? I'll say too, that some manufacturers simply refused to do business with the volume discounter until after Leegin. They had built up a market for themselves with independent shops without needing to go to the volume discounter... but after they could be ensured that their prices would be stable, they opened the floodgates.
- Joker_vD 5y ago
  > it's harder to maintain that brand image from a pricing standpoint if everyone can just sell it at whatever they want Does this apply to discounters only? The PS5 (and earlier, PS4) resellers are re-selling them at premium, but AFAIK Sony doesn't go after them, at all. > (b) supplying so much product to the discounter meant less was available around the country for retail shops ...don't supply to the discounter so much then? Don't the manufacturers usually supply the retail chains first and only then dump whatever left to the discounters anyhow?
  - MisterBastahrd 5y ago
    which resellers? I would have to imagine that anyone buying directly from Sony and marking up their products would catch the ire of the company, but maybe not. MAP and MRP are more about the downward pressure on prices, not upward, so that companies can't come back later and say "I can't sell your product and make a profit because I'm selling it for too cheap." The discounter largely doesn't care as much because of the sheer volume they were doing. They were selling at near half the price of what brick and mortar shops were selling AND this was during a time where most states were not charging taxes on internet purchases OR on tobacco sales. Say you have a box of cigars that has an MSRP for $100 a box. Break even price is $50. Discounter sells for $60 and offers free shipping. You go to the local store and buy for $100. Then you get hit with a 30% tobacco tax and a 9% sales tax. So now you're comparing $60 vs $139. Even if they didn't have what you want in stock, they probably would have something else you'd like for a fraction of the cost. Most mom and pop cigar stores carry about $50-200K worth of inventory at any one time. This discounter was doing mail order business and had about $80-100M worth of inventory.
foobarian 5y ago
I saw this in Prague in the 80s. Went to buy bread and the price was embossed in the loaf. "5 Kčs"
- Joker_vD 5y ago
  "Inflation"? Pah, what a load of bourgeois nonsense. The bread costs 5 crowns, and had always costed that much since the last price reform in 1969.
rsj_hn 5y ago
The price policy just created shortages, so yes the item was stamped with a price, but unless you knew someone who owed you a favor or slipped the clerk something extra under the table, it would be hard for you to purchase it for that price. This also led to endless queueing, where standing in line was a full time job. It would not be uncommon to wait in line for a few hours when rumors spread that a particular store got some bread in, or that a butcher finally had some meat. This job was then assigned to grandmothers and others who did not have to show up to work -- to basically spend all day standing in line in front of various stores, hoping to come back with some groceries. That created an entire black market economy of side payments and private goods which were not stamped with a price, but the government tolerated this economy because they knew that without it, many household essentials could not be obtained. That normalization of bribes meant that if you had to go a doctor and wanted to be treated decently, a side payment was required. If your car broke down (although most people learned to fix most issues on their own) a side payment was required. If some apples became available and you wanted to get one, a little money or barter was needed. Maybe you had an uncle in the country who made some sausage, that could be exchanged for a dental visit in which anesthetic was provided. So the economy began to devolve to barter. If you were not good at politics and you had nothing to barter, life was pretty hard. I once traded a pack of sunflower seeds for private access to a UNESCO world heritage site. The friend of my uncle who was running the restoration (one of those eternal ongoing projects started in the 50s) unlocked the doors for me and let me crawl around the scaffolding. I was able to touch the frescos! But, you see, I had the desired sunflower seeds. This is portrayed beautifully in many underground books and even some mainstream books like Master and Margarita, where the main objective of everyone in the novel was obtaining an apartment in Moscow. Yes, those apartments were cheap, but available only to insiders or members of the nomenklatura. Hence the endless jockeying, politicking, and finagling to get onto various secret waiting lists or catch the favor of a government official who might in their beneficence put you on the right list.
jpindar 5y ago
When I was a kid, prices were printed on comic books and on paperback books in the US. I don't know when they stopped.
colanderman 5y ago
The USA's capitalist image aside, price tags per se are as American as apple pie, having been invented by Quakers, who found haggling/price discrimination immoral. They caught on in industry because they helped optimize the checkout process. [1] (Consumerism is arguably more strongly tied to the American identity than capitalism.) The concept of MSRP to me (as an American) is not too far removed from that of the price tag, which I guess makes it not too surprising to me that MSRPs are culturally normalized here. [1] https://en.wikipedia.org/wiki/Price_tag#History https://en.wikipedia.org/wiki/Price_tag#History