Is it possible to negotiate a selling price with upstream and downstream manufacturers? The legal issues of price determination that retailers, e-commerce, and personal professionals must understand

Suppliers want to intervene in price decisions, can they? If it is not agreed by contract, can it be changed to another way? Is it okay to use the suggested price? Can flower suppliers agree on flower sales prices with flower shops? Can furniture suppliers agree on furniture sales prices with furniture companies?

Who should use the fair trade law resale price

Regarding the agreed price, it is necessary to confirm whether the relationship between upstream and downstream or between suppliers and sellers is a distribution relationship or a consignment relationship ?

The distribution relationship is that the downstream buys the upstream products, and then the downstream sells them to the outside world. The profit obtained is the difference between the cost of the purchase and the selling price.
→Restrictions on resale prices under the Fair Trading Act

The consignment relationship is to not buy out the goods, sell the supplier's goods to others, and charge the supplier a commission. The profit obtained is the commission agreed with the supplier.
→Resale price restrictions under the Fair Trading Act do not apply

You can't limit the resale price, so I can agree on a range, right?

At present, the court's opinion holds that the resale relationship cannot agree on a restricted resale price, whether it is a specific price, a maximum resale price, a minimum resale price, or an interval resale price (dealers can only set prices within the price range agreed by the supplier). ), resale prices that must be recognized by the supplier are illegal.

So what if you don't know what to say?

The court further held that the implied resale price is also not acceptable!
The implied resale price is that, although the supplier has not clearly stated in which range to set the price, if the price is lower than a certain range, there will be sanctions, such as reducing supply, increasing the purchase price or other punitive measures, as long as the relevant You will be penalized when you limit the price decision.
In addition, it is also common that the supplier asks to review the sales promotion activities of the seller. If the review fails, the product will not be supplied, as long as the reason for the failure to pass the review is related to the price, even if the supplier and the seller agree, it is also a violation of the Fair Trade Law!

How can I not violate Fair Trading Act restrictions on resale prices?

The supplier's actions must not reach the level of punishment, for example, it is only often called to worry, often to complain about the price, etc. It is not beneficial in fact. And, of course, large supply chains make it harder to change prices through de facto management measures.

While fixed prices allow businesses to have stable and predictable income, is the long-term impact on the market good for the business as a whole? It's actually hard to say. Determining prices is not the way a business survives. Improving competitiveness and maintaining goodwill is the way to long-term survival for an enterprise!

Original link: Kai's Lawlawland