Price Fixing

[Buzby]

We have been notified by a supplier that we must change our prices to match those of another online competitor who sells the products at a much higher price.

We have marked these items up by our standard rate and feel very uncomfortable about hiking the price just to suit a competitor.

I am aware of other websites also selling the same products at about the same price as myself which will make my products expensive in comparison if I do mark them up.

We have dealt with this company for a few years and have started to feel recently that they are starting to get a little awkward with us.

At the moment I feel like discontinuing their products and selling them off cheap.

Has anyone experienced this before or have any advice?

Many thanks

Jason

[leehack]

I believe such instructions to be illegal as cartels are not allowed. If Levis couldn't beat Tescos, you can be sure there is some substance in it.

For sure there are gentleman agreements between suppliers and sellers, however i'm quite astonished to hear them doing this openly - that is treading on very thin ice IMO.

Tell them you will alter your prices when everyone else has also. Fixed pricing is ideal in reality as it just becomes an SEO/Adword battle then.

[Stereo Steve]

They can't do it. But, they can always be out of stock when you phone up.

[Duncan Rounding]

In the long run I expect that you will probably have to tow the line if you wish to sell their products.

Many suppliers do not allow certain product lines to be sold on ebay for similar reasons. It knocks the bottom out of the market and then nobody can make any margin out of the product.

[Buzby]

I can understand what you are saying Duncan and do agree. However I am selling at normal price and my competitor is selling at a huge markup.

I could understand if I was selling at a low level.

[pnagames]

record the conversation and them take them to trading standards (yes iam evil)

one of our suppliers would not open an account for us unless we met certain criteria. everybody else was fine with us.

we also think that they are playing us abit on stocks as well (they supposed to be one of the largest supplier in the UK and they had in stock around 30 different products some of them had only 1 item in stock...)

[wfl]

By law they are not allowed to dictate your selling price and by and large how and who you sell it to.

They are allowed to (reasonably) dictate the discount/margin they offer you, stock availability to you and possibly some required levels of service issues. They can also take a view on things like credit facilities.

[chris ashdown]

If you have proof that they asked you to price fix then I would keep it in a safe place and say nothing more and keep to your own pricing structure

If they then start playing up with out of stock etc, I would suggest to them that if they really piss you off you may report their request to the right people

[pinbrook]

In a very timely manner British airways have been fined 1.5 million for trying to price fix today and expect a further 1.5M fine from the US.

Virgin - because it told tales, gets off scot free

[george]

Suppliers can, and do, select only retailers who agree to sell goods for the prices that they state.


Factamundo.



Oh, and there are ways around it. *coughs*

[Duncan Rounding]

In a very timely manner British airways have been fined 1.5 million...

£121.5m in fact. Wonder what happens to the fine money...governement coffers?

http://news.bbc.co.uk/2/hi/business/6925397.stm

[pinbrook]

£121.5m

Woops lost a few 00000000's here. Well I was in bed half asleep listening to the radio this morning.