Take it as a compliment. Getting big means that others will feel threatened. They’ll growl & maybe even bite.

I’m definitely no expert on the topic, but t seems to me like the law in these matters is just another element in the environment. It doesn’t directly dictate what goes on. Sure they can’t legally stop supplying you. But you competitors can ask them to. They can ask you to. They can send a C&D. They can threaten & growl.

They can use the threat of legal costs as a weapon. All sorts of things can be done ‘with’ the law. You tend to have an advantage if you are a bigger & more established player because 5-10hrs of lawyers fees cost the same regardless of your turnover.

Anyway like I said, take it as a compliment. Big kids rules, I guess.

Maybe this is a cue to start thinking bigger. How about a Di label? Finding white label suppliers is supposedly getting easier. Just a thought (you’ve probably had it too). That’s also the kind of thing that might worry your suppliers. They may appease their clients by softening their competition, but the last thing they want is to create a competitor out of their customer.

BTW Adam, thanks for sharing. Appreciated.

Cheers

Question though: if they stopped selling to you couldn’t you take them to court for not giving you a fair chance to compete? At least that’s how I understood the link to the article Anthony provided.

Don’t get me wrong: I don’t ever want to get to that point in a vendor relationship. I don’t even want to have to mention lawyers or court or anything like that.

I guess my main gripe now is this: they act like we broke the law by selling their products below MSRP, while in fact they themselves might be breaking the law by giving us a MSRP and holding us to it. It would have been nice if they were a little nicer about it to us instead of making it feel like we’re now on “probation” with them for running a Black Friday sale that, by the way, moved a lot of their product off of our shelves and led us to placing more large orders with them.

I’m surprised your vendors don’t already have MAP pricing requirements. A majority of the vendors in every market we’ve worked in so far have minimum advertised price guidelines either equivalent to MSRP or at a level x%-lower than MSRP.

As far as I understand, in the US these companies cannot legally require that we do not sell lower than MAP price.
However, instead of going the legal route, they will simply stop selling to you if they find you are selling lower than MAP.

@Anthony – I honestly never thought of the legalities of the whole thing. From the link you sent me, it seems like it’s OK to give pricing guidelines as long as “the competitive benefits outweigh its anti-competitive effects”. For the most part, I think manufacturers can provide fair guidelines that would be more beneficial than not.

BUT, your comment made me ponder another question: if one of our manufacturers stopped selling to us because they disliked our pricing, would we have legal recourse against them? The answer seems to be yes, since it would be prohibiting us from competing. I am going to bring it up with our lawyer next time we meet to see what he thinks.

@Jenn – congrats on the new gig. Happy to get out of Schick?

@Ted – I completely agree that that’s the way it should be. It’s only fair…right? Again, I never really considered the legal aspects of it prior to writing this post, but now that I have I feel a lot better about what we’ve been doing with our discounts.