10-25-2011, 12:17 PM
Nobody is giving the full straight skinny here.
Under the law that repealed "fair trade" pricing, manufacturers are allowed to set a "Minimum Advertised Price". No dealer can advertise a lower price. But dealers are free to charge whatever they want. Which is why you often see, "call for price" from the very low price dealers. Litchfield cannot be told what price to sell an item for - and they are spinning the story by claiming differently. But Litchfield can be told the minimum price they can advertise. Now, if DCC Specialties puts the MAP too close to dealer cost, then Litchfield is coerced into adding shipping on, or not advertising and charging the lowest price for the item.
Litchfield is too big a player in the DCC world - DCC Specialties and Litchfield need each other in the long run. But it is common in our hobby for a manufacturer to direct sell or sell through a self-owned hobby shop, as well as other retailers. BLI and Factory Direct are an example, as is Bowser and English Hobbies. The manufacturer's in-house retailer has to tread carefully to avoid under-cutting their dealer network. BLI/Factory Direct did just that, causing many retailers to quit carrying BLI. Walther's limits their direct order discounts so that they don't undercut their dealers.
For those who want total freedom for dealers - where does the manufacturer's rights to control distribution of his product start/end? Do you really want the freedom taken away to choose who you will sell your house, your labor, or your own products to? If total dealer freedom was the law, GM, Ford, and Chrysler would not have been able to rid themselves of low performing dealerships. Lionel was both helped and burned through the years selling in discount big boxes - the customer support just isn't/wasn't there, but increased retail exposure was provided. When the company was re-born, a conscious decision was made to only allow qualified dealers to carry their products. A single train set made for/carried by Target is the exception. The law tries to strike a balance between the manufacturer and the dealers.
just my thoughts
Fred W
Under the law that repealed "fair trade" pricing, manufacturers are allowed to set a "Minimum Advertised Price". No dealer can advertise a lower price. But dealers are free to charge whatever they want. Which is why you often see, "call for price" from the very low price dealers. Litchfield cannot be told what price to sell an item for - and they are spinning the story by claiming differently. But Litchfield can be told the minimum price they can advertise. Now, if DCC Specialties puts the MAP too close to dealer cost, then Litchfield is coerced into adding shipping on, or not advertising and charging the lowest price for the item.
Litchfield is too big a player in the DCC world - DCC Specialties and Litchfield need each other in the long run. But it is common in our hobby for a manufacturer to direct sell or sell through a self-owned hobby shop, as well as other retailers. BLI and Factory Direct are an example, as is Bowser and English Hobbies. The manufacturer's in-house retailer has to tread carefully to avoid under-cutting their dealer network. BLI/Factory Direct did just that, causing many retailers to quit carrying BLI. Walther's limits their direct order discounts so that they don't undercut their dealers.
For those who want total freedom for dealers - where does the manufacturer's rights to control distribution of his product start/end? Do you really want the freedom taken away to choose who you will sell your house, your labor, or your own products to? If total dealer freedom was the law, GM, Ford, and Chrysler would not have been able to rid themselves of low performing dealerships. Lionel was both helped and burned through the years selling in discount big boxes - the customer support just isn't/wasn't there, but increased retail exposure was provided. When the company was re-born, a conscious decision was made to only allow qualified dealers to carry their products. A single train set made for/carried by Target is the exception. The law tries to strike a balance between the manufacturer and the dealers.
just my thoughts
Fred W