Quote:
Originally Posted by Gibbon666
I thought that was what Hasbro got in trouble for - price fixing.
As far as I know, they can't set the price you sell at - hence the name Recommended Retail Price (RRP) or Suggested Retail Price (SRP).
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As i am a Buyer for the Biggest UK retalier i know quiet alot about this topic!!
The RRP is as above the Recommended Retail Price, This only means one thing it is Recommended!!
The Retailer can sell the product for what ever they like. So if the RRP is £229 Retailer A could chose to sell it for £249 and Retailer B could sell it for £199, and if they so wished to use it as a lost leader they could sell below cost and sell it for £99. In other countries such as Ireland it is even illegal to sell a product below cost, a law designed to protect the small independant retailers.
The Manufacture
It is illegal for a manufacture to stop supply of a product to a retailer as a result of the price they chose to retail it at.
Manufactures can charge Retailers different cost prices, they will no doubt have a basic cost which they then change as a result of Volume purchased, point of delivery etc etc
It is Illegal
As Marks link already states, Fixing retail prices is Highly illegal. This can result in a jail term if found Guilty!! and a fine of Upto 10% of the Annual company profits which is what happened at Hasbro
In the example of products such as Apple and the PS3, the cost prices of these products are so high, the interest in them so huge and the availibility not great so you have a classic case of demand outstripping supply so Retailers i suspect don't need to reduce prices to sell them as they are giving money away, but what they do is bundle deals to encourage customers to spend as much as possible to increase the cash margin, that is why you never see retailers advertising the price of the individual PS3 you will always see a promotion being advertised which comes with X amount of games or accessories.
Si