Minimum Advertised Price Concerns

[billshearer]

Hello,

I have heard that companies like Nikon and possibly Canon are setting a Minimum Advertised Price. Is this to be a concern for consumers? Why would companies do this and how do they expect to have healthy competition? Being new to photography, I will admit that it is nice to find a good price, and since I am going to be buying into Canon, are there products I should ensure I get before they implement MAP with Canon?

Thanks,
Bill

[John Chardine]

I have heard that this will apply to importing certain items into Canada.

[Henry Posner]

I have heard that companies like Nikon and possibly Canon are setting a Minimum Advertised Price. Is this to be a concern for consumers? Why would companies do this and how do they expect to have healthy competition? Being new to photography, I will admit that it is nice to find a good price, and since I am going to be buying into Canon, are there products I should ensure I get before they implement MAP with Canon?

No disrespect but you're well behind the curve. MAP (Min Advertized Price) has been a fact of life in our industry for a decade or more. What we're seeing today are new components:

- Much stricter enforcement with more strict limitations on how to convey an item's real selling price to customers when that price is below MAP, and in particular restrictions on how this information can be conveyed on a retailer's web site. This is coupled with more strict enforcement and more draconian penalties to a retailer who violates the restrictions.
- Unilateral pricing which sets the minimum SELLING (not advertized) price. This has been legal since the US Supreme Court's decision in Leegin Creative Leather Products, Inc. v. PSKS, Inc. Once again -- strict enforcement and draconian penalties to the retailer who flouts these rules. This was adopter first (as far as I recall) by Sony USA and is now also employed by Samsung, LG, Nikon USA, Pentax USA and others.
- Sales restrictions include limiting which items a retailer may sell online or geographical limitations, like Nikon USA prohibiting authorized retailers from sending any digital slr body to an address outside the USA.

Years ago I attended a retailer's roundtable in northern NJ. I was the only rep from a big store with a substantial mail order and online presence. Everyone else was the owner of a smaller regional or local mom-n-pop store doing business primarily from brick-n-mortar stores. They all LOVED MAP and wanted higher MAP values so they could charge customers those MAP prices without the customer asking them to match our lower selling price.

Now, it's my PERSONAL opinion US distributors are bending to international pressure. After all, I doubt anyone from Nikon/Canada (to pick one brand at random) or anyone working for a Canadian retailer wants to compete with us. After all, if they make no profit on the sale but are expected to support the owner afterwards, it's lose-lose for them. Further, I think these restrictions are the distributors' way to shore up their authorized retailer network. If B&H and one or two other super-retailers are all that's left in a few years, I think Nikon, Canon, et al fear we'll be the dog and they'll be the tail and we'll be able to do whatever we want with impunity. Once again this is my PERSONAL opinion.

How does this affect you? In theory it broadens your choice of where to buy by making our price the same as the tiny store on Main Street. In reality it means we cannot offer a lower price even when we'd otherwise be willing and able to do so. Of course that tiny Main St store may be able to offer the camera they stock and the few lenses at the same price but in terms of breadth or depth of products and brands, they still can't touch us and in terms of the professional advice (uncolored by commissions since we don't employ them) I believe we remain at the pinnacle of our industry. YMMV.

[billshearer]

Well, that is some new information to me. Thanks so much. I was just curious, after some articles I saw on the internet mentioning the issue.