Thoughts on Minimum Advertised Price (MAP)?

[VIP3R 237]

Technology is great and incredible, everything is literally a click away and you can have access to almost anything out there. The last couple years the sporting goods market has exploded, with more companies and manufactures popping up everyday. This has become especially true with purchasing. Many have chosen to do online commerce, and while great for the consumer, it has put a hurting onto the more traditional retail settings with an actual store front. To protect not only their product and brand name, but also the dealer, many have put in a Minimum Advertised Price with their products.

We've seen it mostly with optics such as Leupold, Vortex, Swarovski, Nikon, Zeiss, etc. But now some firearm mfgs have gone to the same system, such as Browning/FNH, and Benelli.

So what is everyone's thoughts on companies placing a MAP on their products?

I think it is a good thing and it levels the playing field between the online dealers and the store front dealers, it also protects profits for both parties.

[SteyrAUG]

Never works.

Everyone on the internet KNOWS what the dealer price is. All you do is hurt dealers with restrictions.

Here's what works.

Retail price (the price suggested by the manufacturer that no dealer has ever gotten).

Dealer price (the starting point for price negotiations with the customer).

Stocking dealer price (the way to let real dealers actually be competitive with the guy who has a hobby FFL).

[Dunderway]

It is a good thing if you want to keep regular stocking dealers happy. I will give two examples from other industries which seem to jive with firearms accessory sales.

Burton snowboards used to have strict price controls, even on previous year close outs. You picked up the catalog with a printed factory price and that was what you would pay. Not having to shop around, especially in the earlier days of the Internet, was nice.

When I rode BMX there was a big online shop that would have a "deal of the day". This deal of the day would be dollars above cost for even a $400 item. It was so cheap that they pretty much filled the demand for said item, Nation wide, for the year. It was killing the little guys, and even the big guys, and they were not happy. This got shutdown fairly quickly.

I am very pro Capitalism, but I also love a B&M shop as well. The manufacturers have a big say in whether those shops survive or not. If they can be competitive (in a real market) then I want them to stay alive.

If a manufacturer lets a giant sell ACOGs at a loss for a year to put me under, then I will stop carrying them long before that. Hypothetically, of course.

[SteyrAUG]

Here's what happens.

I follow MAP rules and sell ITEM X for MAP price on say Gunbroker.

Another dealer gets a "front guy" to sell ITEM X below MAP on Gunbroker.

The manufacturer of ITEM X never can't control the "front guy" because he didn't buy from the manufacturer directly. Obviously he and his "dealer source" split the profits.

And of course EVERYONE buys from the "front guy" because he's got the better prices.

[VIP3R 237]

Here's what happens.

I follow MAP rules and sell ITEM X for MAP price on say Gunbroker.

Another dealer gets a "front guy" to sell ITEM X below MAP on Gunbroker.

The manufacturer of ITEM X never can't control the "front guy" because he didn't buy from the manufacturer directly. Obviously he and his "dealer source" split the profits.

And of course EVERYONE buys from the "front guy" because he's got the better prices.

This unfortunately makes sense. Even if a mfg aggressively enforces their MAP, someone is always going to find a loophole.

[SteyrAUG]

This unfortunately makes sense. Even if a mfg aggressively enforces their MAP, someone is always going to find a loophole.

MAP is impossible to enforce.

All the "dealer" has to do is state that the "front guy" is his customer. No manufacturer can reasonably tell a dealer to NOT sell to a customer who might later choose to flip items on gunbroker.

The only people actually hurt by MAP are those honest, or stupid enough, to not have a "front guy."Since my Gunbroker account easily allows a manufacturer to figure out who I am (I have no front guy) I have to follow MAP rules.

I can't even have a "sale" that is below MAP. But there are two dozen guys on Gunbroker right now who are "front guys" for dealers on every item that has MAP pricing and they are selling far below MAP and have no problems simply because they don't have to answer to the manufacturer.

As a result there are dozens and dozens of products I don't even try and sell any more let alone stock.

Volume pricing is the only thing that works. If you make the gunshow hobbyist and part time FFL have to buy 10 or more to be competitive you eliminate most of them. Problem is most manufacturers don't want to offer those additional discounts to dealers.

[Dunderway]

Here's what happens.

I follow MAP rules and sell ITEM X for MAP price on say Gunbroker.

Another dealer gets a "front guy" to sell ITEM X below MAP on Gunbroker.

The manufacturer of ITEM X never can't control the "front guy" because he didn't buy from the manufacturer directly. Obviously he and his "dealer source" split the profits.

And of course EVERYONE buys from the "front guy" because he's got the better prices.

I honestly had never considered that, but it makes a lot of sense. I am also one of the rare people who is almost afraid of eBay and usually only buy from reputable shops like G&R and BCM, regardless of potential savings.

[TAZ]

MAP only helps the big dealers who need the higher prices to cover their overhead. It also protects the margins of the manufacturer cause there is no negotiations. It also eliminates competition and screws the buyer. The fact that company x can run in a 5% margin while company y needs 20% to make ends meet is not reason to force everyone to pay the 20%. Either y improves or keeps business due to other factors like loyalty, customer service...