Minimum pricing battles

[agamemnus]

Interesting article for economists and economists at heart. Needs more lolcats, though...

http://www.usatoday.com/news/washing...m?csp=obinsite

WASHINGTON — When a Supreme Court majority let manufacturers require retailers to charge minimum prices for their products, dissenting justices warned that the ruling would hit American households hard and could cost some families $1,000 more a year in retail bills.

The 5-to-4 decision provoked an outcry from groups such as the Consumers Union and set off a rush of hearings and concern in Congress and the states. The dispute, Leegin Creative Leather Products v. PSKS, involved the maker of Brighton brand silver-studded belts and other accessories, which had cut off a Texas boutique for discounting its items.

That 2007 decision was one of the first major rulings of the changing court under Chief Justice John Roberts. It also was one of the first in a series of decisions that Senate Judiciary Committee Chairman Patrick Leahy, D-Vt., and other critics say demonstrate the Roberts Court favors corporations above consumers.

[GGT]

Why more lolcats?

In this vein I've wondered about "exclusive contract" deals in retail stores. Not just fashion but beverages, Coke vs Pepsi and all that. I remember being told PA got a deep discount from Pepsi, if they agreed to only carry Pepsi products at turnpike rest stop vending machines. I suppose it works the same way at restaurants when they say "We only serve Coca-Cola products".

There is huge money in this aggie. It's one reason why Outlet malls came to be.....manufacturers like Brighton (or Coach or Estee Lauder or whatever) won't allow department stores to mark their products down On Sale. I've never seen a Coach bag on sale except at their own Outlet shop.

[agamemnus]

Yeah, the "luxury" clothing/accessory companies massively mark up their products. Massively, like maybe somewhere in the range of 300%-1000%.

Another "complaint" that companies have had with minimum pricing is that their "premium" products will be insufficiently demonstrated to the consumer, because the retailer won't have any incentive to do so -- the physical retailer can just demonstrate how "good" the product is, and then a consumer will buy it online for less because the internet-based company doesn't have costs associated with hiring people to demonstrate the product. So they figure that if they can get a minimum price on the product, then stores won't be able to compete on their price, but on their presentation. Thus, companies that demo the manufacturer's "premium" products will get an edge over those who don't.

There are a few things wrong with this, though. The biggest part is that allowing minimum pricing favors big box stores like Best Buy who simply heavily advertise versus those who can't afford to advertise -- they're not demoing the product, they just have more money to burn because they are bigger. Allowing big-box stores a competitive advantage just because they are big is simply basically anti-competitive: the big box stores have no incentive to do anything "better", they just have to advertise louder -- but advertising louder doesn't help the consumer!

[Ominous Gamer]

I've always hated this MSRP ruling Ever since it came to be the price wars for computer components have almost completely dissappeared. B&M stores were hit harder, but even online stores have to hide sales behind a "click to see price in cart" technique.

It's one reason why Outlet malls came to be.....manufacturers like Brighton (or Coach or Estee Lauder or whatever) won't allow department stores to mark their products down On Sale. I've never seen a Coach bag on sale except at their own Outlet shop.

Outlet stores changed years ago. They no longer stock last year's models, or slow selling items. They stock items that are specifically made for that Outlet Store. Corners are obviously cut to save money and make it feel less real (machines vs hand labor, lower quality control, etc.) The same practices can be found in larger chains like WalMart. They may carry name brands, but you won't find exact models at other stores for the same reasons, especially with electronics.

[Dreadnaught]

This is a tough one. I think I don't mind manufacturers placing conditions on sale to retailers in general (unless, as the court ruling states, there is an obvious and significant consumer detriment as in a monopoly situation).

Manufacturers and resellers make all kinds of detailed agreements over a ton of stuff. Few people have any idea how much negotiation and thought goes into things like store placements for Quaker Oats. I don't think price is that much different, but as the Supreme Court ruled there are situations where it could and should be off-limits in an agreement.

What I don't like is the idea that this can also apply to secondary resellers.

[wiggin]

This is a tough one. I think I don't mind manufacturers placing conditions on sale to retailers in general (unless, as the court ruling states, there is an obvious and significant consumer detriment as in a monopoly situation).

I don't know, this is kinda what bothers me. I agree in principle that if a seller agrees to some contractual obligation from their supplier, that should be valid. But I don't like the concept of the supplier being able to legally enforce rules about future sales of their product, including price. To me it seems to violate a product version of first sale doctrine - once I've bought something from you, why can't I sell it by whatever means I wish? If I can turn a profit by selling product X at a loss, I don't see why that should matter to anyone.

[GGT]

Outlet stores changed years ago. They no longer stock last year's models, or slow selling items. They stock items that are specifically made for that Outlet Store. Corners are obviously cut to save money and make it feel less real (machines vs hand labor, lower quality control, etc.) The same practices can be found in larger chains like WalMart. They may carry name brands, but you won't find exact models at other stores for the same reasons, especially with electronics.

Sure, Outlet Malls have evolved. They're no longer where outdated styles or unsold merchandise goes to get discounted, but that's how they started. (Used to have a Sony Outlet store that sold opened but unused merchandise, or refurbished items, at great discount. Also had stores where 'irregulars' could be found with manufacturer tags removed.)

Dept. stores can't just mark-down certain brands, move them to a discount outlet, or send them to TJ Maxx or overstock.com. It's part of their contract with the manufacturer, to 'preserve their brand name'. That's my point---especially for higher end merchandise. Coach is a good example; their stuff isn't marked down in Macy's, and their "outlet store" is not filled with seconds or irregulars. Only Coach can discount Coach, at their flagship stores, dedicated outlet stores, or on-line.

That's what the Brighton (Leegin) law suit was all about. They have a specific style and brand name recognition, only found in small boutique shops, that's their niche. They didn't want to be marked down to knock-off price, or down to "cheap". Women's retail is strange that way---if something never goes on sale it tends to retain its value in prestige, at least in the shopper's mind.

I suppose a minimum price was written in their contract, and that's why they stopped using that shop as a distributor?

[Ominous Gamer]

Dept. stores can't just mark-down certain brands, move them to a discount outlet, or send them to TJ Maxx or overstock.com. It's part of their contract with the manufacturer, to 'preserve their brand name'. That's my point---especially for higher end merchandise. Coach is a good example; their stuff isn't marked down in Macy's, and their "outlet store" is not filled with seconds or irregulars. Only Coach can discount Coach, at their flagship stores, dedicated outlet stores, or on-line.

Brandy worked for Marshalls (TJ-Maxx) up until the middle of this year. There is a loophole in selling items without advertising the fact. For example, if they sell Coach (which they did) or New Balance shoes, all their signs had to say "Name Brand", "High End Design", or "Major Maker". A lot of discount sites like midnightbox, 1saleaday, even Woot, have listed items the same way.

[Dreadnaught]

I don't know, this is kinda what bothers me. I agree in principle that if a seller agrees to some contractual obligation from their supplier, that should be valid. But I don't like the concept of the supplier being able to legally enforce rules about future sales of their product, including price. To me it seems to violate a product version of first sale doctrine - once I've bought something from you, why can't I sell it by whatever means I wish? If I can turn a profit by selling product X at a loss, I don't see why that should matter to anyone.

I guess the question is whether it's a "sale" if you have an ongoing business relationship between a producer and a retailer. For example, some of these agreements have clauses which dictate when the producer has to take back unsold inventory.

Plus there are retail agreements that include marketing cooperatives, whereby the retailers pool money for the media buys behind a marketing executed by the producer (Intel has one of the largest co-op media agreements in the country). It gets very hairy.

On the other end of the issue, these kinds of agreements are also the product of a negotiation. The Supreme Court seemed to be saying that the dynamics of a particular market should matter in whether or not such agreements are unfair or coercive. WalMart is a great example of how a retailer gets the upper hand.

[wiggin]

Fair enough, Dread, I definitely get the basic reason why such voluntary contractual agreements should have some force. What I don't like is the legally enforceable part of mandatory price minimums. If a seller doesn't want to enter into some complex agreement with a supplier, why should the supplier have the ability to force pricing considerations on them?

[agamemnus]

On the other end of the issue, these kinds of agreements are also the product of a negotiation. The Supreme Court seemed to be saying that the dynamics of a particular market should matter in whether or not such agreements are unfair or coercive. WalMart is a great example of how a retailer gets the upper hand.

But Walmart can almost always force the manufacturer to do what it wants, regardless of any minimum price law, not the other way around. Almost no one else can say this. Not a good idea to fight Walmart's pricing power by making manufacturers have more power... it hurts everyone else.

[']['ear]

I don't know, this is kinda what bothers me. I agree in principle that if a seller agrees to some contractual obligation from their supplier, that should be valid. But I don't like the concept of the supplier being able to legally enforce rules about future sales of their product, including price. To me it seems to violate a product version of first sale doctrine - once I've bought something from you, why can't I sell it by whatever means I wish? If I can turn a profit by selling product X at a loss, I don't see why that should matter to anyone.

I tend to agree with this. Once somebody buys something, which a seller does from a manufacturer, it is theirs to do with as they see fit, as long as there is no slander or libel involved.

But I can see both sides of it.

[wiggin]

Well, where it starts to get hairy is that many companies don't retail their own product, so the way in which it is presented through the public is by retailers. That gives the retailer a decent amount of control over how the product is viewed - on the basis of its price, presentation in stores, etc. So it's somewhat reasonable to believe the supplier companies would like their 'brand' to be managed well by others, which might include pricing. Of course, a good brand won't suffer too much from cheap pricing anyways, but it's a bit of a chicken-and-egg problem.

Then again, you also get ridiculous rules from the likes of Apple who have a very large retail presence of their own, but they don't want anyone to undercut their prices on their products as a loss leader. I find that somewhat offensive and uncompetitive.

edit: I think the real problem is when there is an imbalance of power in the negotiation. A company like Apple or Amazon or whoever has a lot of brand power, and they don't sell relatively interchangeable widgets like bolts or T-shirts. Thus, retailers who want to sell their products to be competitive are forced into minimum pricing deals that artificially restrict their business models (and pass on higher costs to customers). These retailers can't go anywhere else, so even a 'voluntary' agreement is likely in some way coercive.

Similarly, it could work the other way - a huge retailer of the WalMart ilk might have such a big portion of the market that they can literally ruin manufacturers who they refuse to deal with - so they might force very low pricing (and margins) onto the manufacturers in order to keep retail prices down (and profits up) - or make a high quality manufacturer look like they have a 'cheap' brand by steeply undercutting competitor's pricing (might this also make other retailers stop stocking the item because sales are low?).

I get how brand management is important in both perspectives, but to me all of these agreements are essentially forced onto one of the parties due to a massive imbalance in negotiating power.

[GGT]

[...]I get how brand management is important in both perspectives, but to me all of these agreements are essentially forced onto one of the parties due to a massive imbalance in negotiating power.

Then you agree with the OP conclusion, that the Roberts court favors corporations over individuals? Between this and Citizens United, that seems to be true.

[wiggin]

Then you agree with the OP conclusion, that the Roberts court favors corporations over individuals? Between this and Citizens United, that seems to be true.

Uh, not quite. Individuals have plenty of negotiating power - they can choose not to buy X product at the prices displayed. Furthermore, the imbalances I was talking about go both ways - consumers probably benefit a lot from Walmart's practices, at least on price.

[Ominous Gamer]

Uh, not quite. Individuals have plenty of negotiating power - they can choose not to buy X product at the prices displayed. Furthermore, the imbalances I was talking about go both ways - consumers probably benefit a lot from Walmart's practices, at least on price.

If this was true in practice I highly doubt the dissenting judges would have mentioned the added expense this ruling could cost households. Sure this may work when you are comparing which brand of sugar filled cereal to buy, or if to buy any at all, but there are far to many everyday, or "necessary" expenses that there are far to few options on.
Your WalMart example bleeds into this the same way. Prices may be low for a time, but once a monoply is secured, there is nothing keeping prices low. In fact WalMart recently announced that they were going to stop offering below MSRP on most of their high traffic food items. Much for the same reason, their SuperStore and Market saturation has secured continued business either way.


If you want to use the "consumer's choice to buy", then I see no difference in putting this court decision in the manufacturer's hands. Don't want someone selling below MSRP? Don't distribute to that channel, its "their choice to sell."

[GGT]

Uh, not quite. Individuals have plenty of negotiating power - they can choose not to buy X product at the prices displayed. Furthermore, the imbalances I was talking about go both ways - consumers probably benefit a lot from Walmart's practices, at least on price.

No no, not from the consumer's POV. You commented about powers in negotiations as the problem, and I'd agree. I'm thinking of the small manufacturer trying to negotiate a contract with a retailer. They might be forced into minimum pricing simply because they have no "corporate leverage", take it or leave it.

Let's say Bitter decides on a couple of regional stores to carry some of his jewelry designs, and wants to keep 'his' merchandise above a certain price level while building his reputation. Why shouldn't he be able to do that? If the roles were reversed and a big-name jeweler wanted a small, independent boutique to carry their designs, they could get away with minimum pricing.

[agamemnus]

Uh, not quite. Individuals have plenty of negotiating power - they can choose not to buy X product at the prices displayed. Furthermore, the imbalances I was talking about go both ways - consumers probably benefit a lot from Walmart's practices, at least on price.

Yes, but it's somewhat different. It would be completely out of the jurisdiction of the government to force the retailer to buy at a certain price dictated by the manufacturer... in this case, two parties agree to a mutual price. In the minimum pricing case, one party is forced to sell to a third party at a certain price.

No no, not from the consumer's POV. You commented about powers in negotiations as the problem, and I'd agree. I'm thinking of the small manufacturer trying to negotiate a contract with a retailer. They might be forced into minimum pricing simply because they have no "corporate leverage", take it or leave it.

In this case, it is just the price the manufacturer can sell his product at to the retailer, not the price the manufacturer wants the retailer to sell at.

Let's say Bitter decides on a couple of regional stores to carry some of his jewelry designs, and wants to keep 'his' merchandise above a certain price level while building his reputation. Why shouldn't he be able to do that? If the roles were reversed and a big-name jeweler wanted a small, independent boutique to carry their designs, they could get away with minimum pricing.

He can still sell at whatever price he wants to a retailer... a high price, a low price, whatever... If the retailers take the high price, they can sell at whatever price they want, too.

But, what he's not allowed to do (most of the time, in most places) is to set minimum pricing -- basically fueling an artificial perceived value on the price via an end-consumer price minimum he dictates to the retailers. Sometimes, the manufacturer can get away with this artificial value, and sometimes he can't. When he can, he's basically tricking the consumer into thinking something is worth more than it really is. Most of the retailers desperately want to sell at a lower price, because it will get them better sales.

But... the manufacturer, and, say, Best Buy, want to "fix" the price. It does create a sort of monopoly situation when a big retailer and a manufacturer act in collusion to set the price... they are perceived to be the only sellers in town (even though smaller sellers exist, they can't advertise as much, so their sales are minimal), and being the only seller in town is called a monopoly, which is generally illegal.

[Dreadnaught]

Well, where it starts to get hairy is that many companies don't retail their own product, so the way in which it is presented through the public is by retailers. That gives the retailer a decent amount of control over how the product is viewed - on the basis of its price, presentation in stores, etc. So it's somewhat reasonable to believe the supplier companies would like their 'brand' to be managed well by others, which might include pricing. Of course, a good brand won't suffer too much from cheap pricing anyways, but it's a bit of a chicken-and-egg problem.

Then again, you also get ridiculous rules from the likes of Apple who have a very large retail presence of their own, but they don't want anyone to undercut their prices on their products as a loss leader. I find that somewhat offensive and uncompetitive.

edit: I think the real problem is when there is an imbalance of power in the negotiation. A company like Apple or Amazon or whoever has a lot of brand power, and they don't sell relatively interchangeable widgets like bolts or T-shirts. Thus, retailers who want to sell their products to be competitive are forced into minimum pricing deals that artificially restrict their business models (and pass on higher costs to customers). These retailers can't go anywhere else, so even a 'voluntary' agreement is likely in some way coercive.

Similarly, it could work the other way - a huge retailer of the WalMart ilk might have such a big portion of the market that they can literally ruin manufacturers who they refuse to deal with - so they might force very low pricing (and margins) onto the manufacturers in order to keep retail prices down (and profits up) - or make a high quality manufacturer look like they have a 'cheap' brand by steeply undercutting competitor's pricing (might this also make other retailers stop stocking the item because sales are low?).

I get how brand management is important in both perspectives, but to me all of these agreements are essentially forced onto one of the parties due to a massive imbalance in negotiating power.

I think you underestimate the power of the retailers. Or the the complexity of these kinds of relationships. After all, a company like Apple has opened its own line of retail stores clearly because they decided they couldn't get what they wanted from a traditional electronics retailer.

Plus, think about companies like CPG firms. They are heavily dependent on marketing and volume to grow their business. But they don't have their own distribution channels. They would have no business without the retailers, who can pretty easily shut them out of their limited shelf space in favor of one detergent over the other.

[GGT]

Yes, but it's somewhat different. It would be completely out of the jurisdiction of the government to force the retailer to buy at a certain price dictated by the manufacturer... in this case, two parties agree to a mutual price. In the minimum pricing case, one party is forced to sell to a third party at a certain price.[etc]

This whole thing sounds like an area of contract law to me. Bitter could negotiate with a retailer that if his product doesn't sell at X (lowest) price, he reserves the right to refund their money and take the jewelry back, before they mark it down further than X. Sort of like first right of refusal in real estate negotiations?

Or he could "display" his product to a store at no charge, and they get a % of the purchase price set by Bitter, but only if/when it sells. The latter should definitely give the manufacturer the right to set minimum price. I've heard of artisans and small operations making that kind of deal to get their merchandise shown in a store, without the retailer having to take any up front risk whatsoever.

[']['ear]

Well, where it starts to get hairy is that many companies don't retail their own product, so the way in which it is presented through the public is by retailers. That gives the retailer a decent amount of control over how the product is viewed - on the basis of its price, presentation in stores, etc. So it's somewhat reasonable to believe the supplier companies would like their 'brand' to be managed well by others, which might include pricing. Of course, a good brand won't suffer too much from cheap pricing anyways, but it's a bit of a chicken-and-egg problem.

Then again, you also get ridiculous rules from the likes of Apple who have a very large retail presence of their own, but they don't want anyone to undercut their prices on their products as a loss leader. I find that somewhat offensive and uncompetitive.

edit: I think the real problem is when there is an imbalance of power in the negotiation. A company like Apple or Amazon or whoever has a lot of brand power, and they don't sell relatively interchangeable widgets like bolts or T-shirts. Thus, retailers who want to sell their products to be competitive are forced into minimum pricing deals that artificially restrict their business models (and pass on higher costs to customers). These retailers can't go anywhere else, so even a 'voluntary' agreement is likely in some way coercive.

Similarly, it could work the other way - a huge retailer of the WalMart ilk might have such a big portion of the market that they can literally ruin manufacturers who they refuse to deal with - so they might force very low pricing (and margins) onto the manufacturers in order to keep retail prices down (and profits up) - or make a high quality manufacturer look like they have a 'cheap' brand by steeply undercutting competitor's pricing (might this also make other retailers stop stocking the item because sales are low?).

I get how brand management is important in both perspectives, but to me all of these agreements are essentially forced onto one of the parties due to a massive imbalance in negotiating power.

Apple is probably a poor example. Sure, there's lots of shennanigans going on there, but their product is in large part functionally defined by their exclusivity: by being persnickety assholes about clones and the uses of their operating system, they have made a product that is more stable and easier for non-experts to use. This is not a legitimate way of developing a product? Their success is largely due to these exact features.

{just talking computers here, not stuff like the iPod}

Then you agree with the OP conclusion, that the Roberts court favors corporations over individuals? Between this and Citizens United, that seems to be true.

Meh. They are strongly pro-business, which coincidentally will often not favor individuals. In fact, the entire court is pro-business starting with Clinton appointees. At this point it's the "more pro business" and "less pro business" branches.

[agamemnus]

Meh. They are strongly pro-business, which coincidentally will often not favor individuals. In fact, the entire court is pro-business starting with Clinton appointees. At this point it's the "more pro business" and "less pro business" branches.

Coincidentally = easy way out. Favoring corporations over individuals isn't necessarily pro-business or not pro-business. One can be pro-business but not allow corporations to rule us, you know?...

It's kind of like being "for" illegals because they bring cheap labor or "for" illegals because they bring votes. Neither one is acceptable...

[']['ear]

Coincidentally = easy way out. Favoring corporations over individuals isn't necessarily pro-business or not pro-business. One can be pro-business but not allow corporations to rule us, you know?...

It's kind of like being "for" illegals because they bring cheap labor or "for" illegals because they bring votes. Neither one is acceptable...

You're barking up the wrong tree. I made no effort to argue causality, but was in fact arguing against GG's point. So you should be addressing her.

[GGT]

Coincidentally = easy way out. Favoring corporations over individuals isn't necessarily pro-business or not pro-business. One can be pro-business but not allow corporations to rule us, you know?...

Thought it'd be fun to link to Brighton, the division of Leegin Creative Leather Products in the law suit. You can type in your zip code to see your local distributor/retailer. There are two in my 10 mile radius, and they're both small, independently owned and operated boutiques. I'm pretty sure they "covet" their status as an "official retailer for Brighton products", because that's what they're all about---offering niche merchandise that can only be found at certain shops. (Troll Beads and Vera Bradley works the same way.)

It's surprising a small shop like PSKS decided to either (a) go against their contract with Brighton, or (b) didn't understand their contract, or (c) would mark down that particular merchandise as a way to attract future customers.

http://www.brighton.com/

It's kind of like being "for" illegals because they bring cheap labor or "for" illegals because they bring votes. Neither one is acceptable...

Huh? I don't understand your analogy. Unless you mean it's all political posturing?

[GGT]

You're barking up the wrong tree. I made no effort to argue causality, but was in fact arguing against GG's point. So you should be addressing her.

GG is still trying to figure this out from all angles.

Example: I found a cool newish item called the Pup Light. It's an LED collar light for dogs. Invented by an average person who wanted to replace her dog-walking flashlight. Nifty device, great entrepreneurial story

I wanted to find a local retailer to buy it for a gift (Petco supposedly carries it, but it doesn't show up on their web site. Is that because they won't "advertise" it? Why not? Only one small, independent pet shop is listed as a retailer, but I haven't been there yet to compare their price to direct on-line purchase @ $19.99 plus shipping.

The story got more interesting once I learned the product had been chosen by several government agencies as a tool of choice. (For police dogs, search dogs, disaster planning, etc.) She had to go through a rigorous process to be considered an "official supplier" *and dealer with government agencies*, but I wonder how much they pay for it? Does my small pet shop charge more or less than her direct web site? If I were the retailer.....why would I agree to carry an 'over-priced' item that competes with her 'wholesale price' direct web site?

[agamemnus]

Potential scenario:

Because you only buy it once. Chances are you see it in the shop first, and you'll buy it. The shop can set a markup because most people won't be specifically looking for that product online; instead they will find it randomly in the pet shop.

[GGT]

Alternate scenario:

You find it on-line first, but would rather touch and feel it first, before paying shipping to send it as a gift. What retailer would bother carrying an item if it's not also competitively priced with the on-line version?

[agamemnus]

Alternate scenario:

You find it on-line first, but would rather touch and feel it first, before paying shipping to send it as a gift. What retailer would bother carrying an item if it's not also competitively priced with the on-line version?

>What retailer would bother carrying an item if it's not also competitively priced with the on-line version?

The retailer in my scenario. It depends on how visible the product is and how immediate the need. As an extreme example, take candy/gum by the checkout line. It is extremely overpriced and more expensive than a pack of candy from even the same store, 'cause of convenience.

[GGT]

>What retailer would bother carrying an item if it's not also competitively priced with the on-line version?

Did you click on the Brighton web site and find your local retailer? Did you read my story about the Pup Light?

The retailer in my scenario. It depends on how visible the product is and how immediate the need. As an extreme example, take candy/gum by the checkout line. It is extremely overpriced and more expensive than a pack of candy from even the same store, 'cause of convenience.

But that's a retailer using over-pricing based on convenience. Yeah, I paid like 3 bucks for a box of Kleenex at a gas station recently. But wasn't this about MINIMUM pricing contracts and who should control that?

[agamemnus]

Oh.. I didn't know you were still talking specifically about that. So, in the case that a manufacturer "forces" the retailer to set a minimum price while the manufacturer has a lower price, I guess the retailer usually would not agree at all to this arrangement.

The scenario I outlined a few posts ago would not occur, because, for the manufacturer to force the retailer to set a minimum price requires the manufacturer to have a lot of bargaining power; his/her product(s) would already be well-known.

I guess the only way that the manufacturer would do this sort of arrangement is if they had a few "outlet" shops -- there are natural outlet shops that don't require minimum pricing because the manufacturer is located next to those shops or some similar reason, but this would be an "artificial" outlet shop...

If the manufacturer gets greedy and puts up tons of these artificial outlet shops, then the retailers would not want to keep this arrangement.


'Course, if the retailer sold in a state where minimum pricing is illegal, then the manufacturer would be fined and jailed.