Hello High Prices? New US Supreme Court Ruling

CameraQuest

CameraQuest

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In its infinite wisdom, the US Supreme Court ruled that minimum prices set by the manufacturer are once again lawful.

"Shoppers who never pay full price for name-brand goods may have to reconsider as a result of a Supreme Court ruling yesterday overturning a decades-old antitrust standard that made it difficult to enforce manufacturer suggested retail prices."

read story at http://www.post-gazette.com/pg/07180/798061-28.stm

Stephen
 
Hooray! As someone employed by a small specialty retail store in Vancouver, we are constantly in a battle with cheap U.S. discount houses and local big box stores. We have to sell ourselves on our quality of service and product knowledge but we get plenty of people who use us for information and then buy the product cheaper in the States or wherever.
This is good news for me and the health of my business.
 
Hmmm...strange...it would seem that the direction of the government, of late, had been to benefit big business. I am not an economist, but this seems like this is going against that trend - a real bonus for the little guy, while simultaneously sticking it to the consumer. Or am I not understanding this correctly?
 
I think a lot of this has to do with how much margin does the MFG demand that they store has. There are ways to compete in this sort of market (free installation, recycling of your old item) that may not impact the purchase cost, but might on the total cost.

ZI and their drive to close the gray market to their products was very much like this too.

I always throught that a company was free to sell to whom ever they wanted to for what ever price they wanted to. I would say if someone is selling your product at a lower price than you want them to you could find some reason to raise the price to them the same percent.

I'm not sure how much this will impact most of our lives here in the US. Walmart, Target, Costco and others drive too much of the volume for most of us.

B2
 
here is my conclusion - this ruling will be overturn in the next court, perhaps in 5-10 years or so. it is a long battle. those 5 people don't seem to grasp economic very well.

there are 2 types of pricing economic theory, classical economic theory introduced and analyzed by adam smith alike is based on concept of "margin", labor + cost + margin = price; neoclassical economic theory takes a step further with the introduction of "elasticity of supply and demand", so price is set at where demand and supply met.

i personally believe this will hurt small businesses more than protecting them from the competition, because as noted, "shopper never pay full-price for name-brands" will never pay full-price. small shops carrying limited range of products will suffer because of elasticity and substitution of supply and demand. big retailers are ready to gain.

one exception, definition of "name-brand" vs "premium product" is different. people will pay premium for a name brand product, akin "conspicuous consumption", but people will not pay name-brand if it can not be considered worth the premium.

in any case, anti-trust in this era is pretty much in name only. I think Apple Computer is more a monopoly than Microsoft, IMHO.

cheers,
 
CameraQuest said:
In its infinite wisdom, the US Supreme Court ruled...
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Hey, since November 2000, wisdom is no longer in the job description.

It's been painful to see the Bizarro World decisions lately.
 
Stephen

But that would invite a flood of grey CV cams and lenses? Please dont answer non question...

Noel
 
mervynyan said:
in any case, anti-trust in this era is pretty much in name only. I think Apple Computer is more a monopoly than Microsoft, IMHO.

cheers,
Click to expand...

But they have done it in such a kinder and gentler way!

I think BG, having a father/lawyer knows where the edges are and is not as afraid to be there when compared to SJ.

B2 (;->
 
photogdave said:
Hooray! As someone employed by a small specialty retail store in Vancouver, we are constantly in a battle with cheap U.S. discount houses and local big box stores. We have to sell ourselves on our quality of service and product knowledge but we get plenty of people who use us for information and then buy the product cheaper in the States or wherever.
This is good news for me and the health of my business.
Click to expand...
Yo, dude, this was a USA ruling. Nothing to do with Canada.
 
Hmm, curious. How does this effect the monopsony power of Wal-mart, by which it (the retailer) tells the manufacturers the minimum prices they will sell items for (it's the way they act all the way down the food chain to lower wages/working conditions/etc.)
 
Nowadays, when a law is passed, I hardly know if it is a good thing or a bad thing. I like just less laws.
 
Yo dude, read my post properly. We have to compete with U.S. prices with our dollar nearly at par. We are losing business to the U.S. If they have more control over their reatil prices it means we are better able to compete and keep our business!
 
Uh oh. Better hurry up and order that ZI from PopFlash before they are sued by ZI to stop their gray market business. Once they and other gray market dealers are gone, I wonder how much the ZI will go up in price? Perhaps high enough to stall the recent rangefinder revival? Maybe only for their product?
 
It's not like you can set your competitors minumum pricing. Even beyond the classic and the neoclassic theories, these are not commodities. Everything is branded now a days. Gas, water, someone was trying to sell air at bars recently. This just allows manufacturers to control thier brand image.

My question is what would this do to liquidators that buy a failed store and have to clear the products. I can't think that they would be bound by agreements by the manufacturer and the failed store.

I wonder how many manufacturers say to their regular customers that they are getting a good deal and that they aren't undercutting them, but when sales slow down they sell some graymarket stuff at lower prices to keep the plant busy.

Not much to do with Wal-Mart. They'll probably tell manufacturers to stuff it. They care more about the price they pay, or more precisely, how much less they pay than other people.

I was talking to my mother-in-law who owned a packaged concrete business years ago. The big box places used to sell their product below the price that they paid for it. How fair was that to the smaller chains.

I'm all for free markets, but I'm not a fan of suicide pacts.

If you see it as anti-competitive, look at as a way for another supplier with out minimum prices to take business away from a company with minimum prices.

Mark
 
photogdave said:
Yo dude, read my post properly. We have to compete with U.S. prices with our dollar nearly at par. We are losing business to the U.S. If they have more control over their reatil prices it means we are better able to compete and keep our business!
Click to expand...

You don't sell medicines do you? I think the situation is reversed in that case.
 
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