Where Should I Buy A Rolex?

[Twotone]

Manufacturers can set their prices to distributors and/or dealers. Volume discounts, rebates, dealer hold-backs etc. are fine. They are also allowed to set "MSRP". Manufacturers are not, however, allowed to dictate what price retailer can actually sell the product. This is true for watches, cars and any retail product. Others with more legal experience then me can give a better explanation.

Twotone

 

[SoCal2NYC]

I'm sure that to be an authorized dealer you sign a contract stating that you will sell it at the price we say or you won't sell Rolex.

How is that wrong? If you don't like that, don't sell Rolex.

 

[Twotone]

I believe the "you will sell it at the price we say or you won't sell Rolex" part of a contract is in violation of FTC rules. Others with more legal experience can give a more complete explantion.

Twotone

 

[SoCal2NYC]

Why would that be a violation?

 

[devin]

I am no lawyer either, and the area seems a bit gray, but I think that falls into the MSRP/price fixing/price maintenance bucket and runs afoul of anti-trust laws (in the U.S.)

 

[topcatny]

A retailer is free to sell their merchandise at whatever price they deem appropriate.

A manufacturer is also free to sell their product to whomever they deem appropriate.

If a retailer is selling products at below the MSRP, manufacturers such as Rolex will likely determine that retailer is not an appropriate dealer anymore. So while a manufacturer can't "dictate" the price to the retailer, there are other ways to compel retailers to sell goods at the manufacturers "suggested" retail price.

There are other details and exact verbage in how to word things when dealing with retailers, but that is the basic idea.

 

[whacked]

Originally Posted by Twotone

I believe the "you will sell it at the price we say or you won't sell Rolex" part of a contract is in violation of FTC rules. Others with more legal experience can give a more complete explantion.

Twotone

They did away with that particular law last year IIRC. There was a thread on here discussing it.

And as the previous poster said, there are quite a number of ways to get around such legislations.