(redtree00 @ June 29 2005,19:07) I have 2 Tommy Bahama Hawaiian print silk shirts purchased from Bloomingdales at over 50% off.
That markdown money is coming from Bloomingdale's, not TB. A retailer can at any point markdown it's merchandise, however, if the wholesaler disagrees with the markdown, they will not put any money towards it, or they will just take returns on the merch. Â Â A smaller company like TB would benefit more from just taking returns.
Maybe and maybe not. I bet TB runs their department store business differently then their own stores. Wholesaler's today expect that department stores are going to have to take MD's at a certain point to move through seasonal product, particularly at the end of each season. Also, I am curious why you think TB would benefit more from taking returns. What are they going to do with the inventory once they get it back? In my experience it is more profitable in the long run for a wholesaler to help the stores take a markdown and sell through the merch themselves. Granted, the companies I have worked for are bigger than TB, but TB does approx $300 million a year, so they are not exactly small.
Buster Firms can set ceiling price on their products ( has to do with bargaining power of the retailer and the supplier).
Again this is sort of true. As a supplier you can suggest
retail prices. Once the stores have the goods they can price them however they see fit. Now granted, the wholesaler doesn't have to support companies that sell their product at a lower price, nor do they have to continue selling them, but they can not set prices. Most stores do follow those suggested
retail prices though.