[Disclaimer: I am not a lawyer. I don't play one on television. The following should not be considered legal advice. When in doubt, consult with your attorney.]
This post was inspired by a conversation on another forum about pricing. To make a long story short, Dealer A was selling an item at a fair markup. Dealer B was selling the same item barely above cost. The question was, how could dealer A convince Dealer B to charge a more reasonable price?
The answer to the question is "He can't." The Federal Trade Commission doesn't look kindly on two or more competitors agreeing on retail pricing. In fact, it's a felony. I don't know about you, but the last place I want to be is in federal prison, surrounded by murderers and thieves, when they found out I got busted for "acting together (with a competitor) in ways that can limit competition, lead to higher prices, or hinder other businesses from entering the market." It could be a very long twenty years.
Seriously, the FTC defines "Price Fixing" as "companies getting together to set prices." So, what's Dealer A to do? First, contact the manufacturer. US courts have established that manufacturers do have some rights when it comes to setting retail pricing. Let them handle it. Worst case--your rep might go to jail, but you won't. (Be sure to send him/her a card at Christmas.)
If that doesn't work, stop carrying the offending line or product. If you can't make money on it, why carry it? If it's a traffic-building brand, then you have to carry a profit line where you can make money. [Hint: Contact your Tacony Corporation representative. He/she can help.]
Or, if you absolutely must sell the item in question, find ways to add value to justify your price. Free delivery, free service, and free accessories are just a few things you might add.
Finally, the FTC has a booklet called "Competition Counts" that sheds some light on this whole "anti-trust" thing. It's short and to the point, and you should have a copy of it on hand. It's free.
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