surefire getting dealers to set prices?

[keithhr]

I went to buy an L4 from a dealer that I had purchased from a number of times in the past today and was told that surefire had requested him to not sell the L4 for less than $139.95. I checked around a bit and was told that was certainly news and they had heard nothing of the sort. I was told that it was kind of hush hush and that the dealers that adhered to surefire requests would in effect get preferential treatment. I felt I could no longer purchase from the dealer and e:mailed them my intentions. I purhcased the light elsewhere and thought I would ask if anyone on the cpf has heard of this before? I wasn't going to say anything but after digesting what had happened I felt I might not have been given correct information from the dealer I had first contacted.

 

[Josh]

/ubbthreads/images/graemlins/confused.gif

 

[Badbeams3]

I haven`t heard anything about this...but it would seem to be a good protective measure. Could even have it`s roots based on some incidents discussed earlier here at CPF.

The problem occures when all the dealers are playing by the rules...except one or two.

Perhaps we are seeing new waters tested...or re-tested. The concept of price-fixing didn`t work in the past of old. But now, in the days of the internet...and forums like CPF...information moves so quick... The dealer that sells the lowest (and has good CS) gets the money.

This can be a disaster for the manufacture as other dealers, who can`t compete (under the requsted rules) and profit, stop ordering the product from the manufacture. This reduces the exposure to the product and the manufacture begins to suffer. Often forcing the manufacture to reduce it`s prices further in an attempt to keep the non-profiting dealers interested.

And a domino effect can begin... Unless the manufacture has "laws/rules" written into it`s signed distributer/dealer contracts...and a clear explination of the consiquences for those who violate them...dealers/ditributors will do as they prefer...and that is profit...often without regard to the consiquences it may have on the other players.

Maybe someone else can explain this better, as I really don`t understand it that well myself.

 

[FC.]

It is true.

 

[Alan Hsu]

Is it legal?

 

[McGizmo]

I'd like to throw in my 2 cents; point of reference being involved in retail and distribution for the last 20 years. I think the price of $139.95 is a realistic selling price for the KL4. I base this on privileged knowledge of dealer cost (conversation with a dealer friend), SureFire's established MSRP of $160 and most important, based on the margin available to the dealer if they sell at $139.95. The L4, beyond CPF is a specialized and relatively expensive flashlight. If this product is to be stocked by the dealer network at large and available to the customer, whomever, whenever or wherever, a reasonable profit needs to be there to justify a dealer holding inventory. The L4 is NOT a commodity item. It may be that SF has incentive and MAP pricing programs in place or going into place. Properly done, these *are* legal and can enhance a level playing field as well as encourage a healthy supply chain and distribution network.

If established and consistant pricing is too high, the market pressure will have effect. For a good and healthy dealer network to prevail, there is a two way street where the manufacturer must support the dealer and likewise the dealer needs to support the manufacturer.

I doubt very much that the recent Arc/ Dealer situation aired here on CPF has any bearing on SF's alleged program but certainly one can see the dynamics involved and perhaps understand that a fair amount of cooperation is required between manufacturer and dealers. This cooperation is *not* anti free enterprise as far as I am concerned but necessary for a strong and healthy system.

Food for thought: we are all aware of trends in price slashing, competition based solely on price and deep discounts being advertised and sought by many in various markets within our economy. Question, is our economy strong and are you seeing improvements in these markets in terms of high availability and diversity of product offerings? If you go to work tomorrow and the boss starts your day with a downward wage negotiation so he can sell your companies goods or services at a lower more "competitive" price, has your economic situation improved? If this is wide spread, is the collective economic situation improving?

- Don

 

[Badbeams3]

Can`t think of why it wouldn`t be. Guess if I think the price of a Supernova Splat Light (price fixed light) is to high...I can buy a Bazzuka Boom Light..for less...up to me.

 

[FlashlightOCD]

[ QUOTE ]
Alan Hsu said:
Is it legal?

[/ QUOTE ]

It is legal ... have you ever tried to get a discount on BOSE radios or speakers?

What is NOT legal is for direct competitors to agree to standardized fixed prices on their competetive product lines.

 

[keithhr]

thanks for the responses, I wasn't sure what to think and believed that if it was an actual policy that surefire was beginning to nurture, that more than one dealer would know about it. If it was being experienced by more than one dealer , I could probably understand where they were coming from. If it was just one dealer creating a reason to keep up their prices, I would like to know. What the dealer told me just sounded fishy to me, my inner voice kept saying hmmmmm, just doesn't ring true.