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Why the minimum locked prices? (MAP)


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#1 proverbialguy739

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Posted 20 August 2013 - 04:01 PM

On airsoftgi, i noticed all KWA weapons have a MAP on them. To those who dont know what that is, its a recently legal thing that lets all companies that sell their products through online retailers set a minimum, not negotiable price that their products can be sold for. The problem is that airsoftgi has a ton of sales and unfortunately, since i can only order stuff online, i will not be directly supporting a company that prevents me from utilizing sales from their distributors.

Some companies have done research and determined that MAP is generally worse for business than allowing an open market, but if kwa cant come to the same conclusion i will just have to purchase my gear from ebay for whatever price people want to sell at...

I seriously hope you guys renounce this; it disappoints me that such a great company could make such a consumer unfriendly decision. The only problem i have with MAP is that the pricing is non negotiable. The distributor cant make their own decision to sell stuff on sale (thus taking in less of a profit for themselves but gaining more customers overall). Instead, they are forced to prevent their customers from using coupon codes and special deals on KWA products...

#2 RexRocker AEG Dr

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Posted 20 August 2013 - 05:55 PM

View Postproverbialguy739, on 20 August 2013 - 04:01 PM, said:

On airsoftgi, i noticed all KWA weapons have a MAP on them. To those who dont know what that is, its a recently legal thing that lets all companies that sell their products through online retailers set a minimum, not negotiable price that their products can be sold for. The problem is that airsoftgi has a ton of sales and unfortunately, since i can only order stuff online, i will not be directly supporting a company that prevents me from utilizing sales from their distributors.

Some companies have done research and determined that MAP is generally worse for business than allowing an open market, but if kwa cant come to the same conclusion i will just have to purchase my gear from ebay for whatever price people want to sell at...

I seriously hope you guys renounce this; it disappoints me that such a great company could make such a consumer unfriendly decision. The only problem i have with MAP is that the pricing is non negotiable. The distributor cant make their own decision to sell stuff on sale (thus taking in less of a profit for themselves but gaining more customers overall). Instead, they are forced to prevent their customers from using coupon codes and special deals on KWA products...
After reading your post I saw this and thought it might help shed some light and add some perspective: http://www.sba.gov/c...mpacts-your-ret

The link is above, here is the actual text:

How Minimum Advertised Pricing Impacts Your Retail or Online Store’s Marketing Efforts

by Caron_Beesley, Community Moderator
  • Created: March 6, 2013, 7:37 am
  • Updated: March 6, 2013, 9:12 am
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If you run an online or retail business, did you know that you might be prohibited from advertising a manufacturer’s products below a certain minimum price?
Minimum advertised pricing (MAP) policies are particularly critical to manufacturers who sell their products for online resale, given the ease at which consumers can now conduct online and mobile price comparisons. MAP policies are also established to help small businesses compete and sell on service and value, rather than entering into a price war with cost-cutting big box stores.
But how legally enforceable are these minimum advertised pricing policies and, as a small business owner, is there a way to get around them in your sales and marketing practices?
The Truth About Minimum Advertised Pricing
Minimum advertised pricing only relates to “advertised” pricing and is perfectly legal under U.S. antitrust statutes. So, essentially, you are limited to advertising MAP-protected products at a certain price, but you can sell these products at any price you choose (often guided by the Manufacturer’s Suggested Retail Price or MSRP).
What Does this Mean for Online Businesses?
Under typical MAP agreements, online retailers can’t “display” any prices that fall below the MAP price. But which part of an online store actually represents advertising display space has caused quite a bit of controversy. For example, say a product is listed on a site for $10. Once a coupon code or other incentive is applied, the actual shopping cart price could come down to $8. Is that still considered “advertising” since a transaction technically hasn’t yet occurred, or is it a commitment to buy and outside the scope of a MAP agreement?
The difference between an advertised price and an actual price that you may be charged has come under scrutiny by U.S. Circuit Courts and FTC rulings, which tend to agree that an actual price displayed in a secure/encrypted shopping cart isn’t subject to MAP – because it’s technically not advertising space, but represents an actual storefront. So in an online world, an actual price may legally end up being a lot lower than the MAP-required advertised price.
In fact, manufacturers are often advised to focus their MAP policies on advertised prices in paid search ads, shopping comparison ads, and internet landing pages but not in shopping carts or other point of sale interfaces.
Look for Alternative Ways to Discount
While it’s not always advisable to lead with price in your marketing efforts, look for other ways to attract customers without breaking any MAP agreements. For example, many manufacturers are okay with your offering free shipping, coupon codes, or a “buy-one-get-one at a discount,” if MAP doesn’t protect that other item. Essentially, as long as the dollar value of the MAP-protected product isn’t reduced, then you are okay. Be careful with coupon codes. It’s safer to advertise the coupon—not the product that it can be applied against—so as not to imply that you are advertising the MAP item at a reduced price. Instead, be clear about what items are excluded from any coupon code promotion.
The Bottom Line
If you are unsure about how your online advertising and marketing practices may border on breaking any MAP agreement you have with a manufacturer, talk to them or consult a legal attorney. Manufacturers do monitor their dealers for potential violations and the law is constantly in flux on this one, so do your due diligence.
For more information about the legality of MAP policies, check out the Federal Trade Commission Guide to Antitrust Laws.

I have a friend who owns a small airsoft shop with no web business.  According to him, it is nearly impossible to compete without MAP pricing in place.

Edited by RexRocker AEG Dr, 20 August 2013 - 06:14 PM.


#3 proverbialguy739

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Posted 20 August 2013 - 08:12 PM

Because of MAP pricing, retailers are paranoid that any kind of discount (such as coupon codes) will get them into legal trouble.
I am not a fan of these kind of things because all it takes is one company that doesn't like coupon codes to get all of the other brands that follow MAP policies blocked from coupon codes on certain websites. If KWA could at least send out a general message to their retailers explaining exactly what they will enforce and what they won't, I am sure everyone would benefit. MAP pricing is one of those things where a company chooses to be safe rather than sorry, and it would be very difficult for something like airsoftgi (relatively large business with hundreds of brands available) to contact each and every MAP enforcing manufacturer asking for their expressed permission to allow special events and promotions.

I'm not saying that it is good for a large business to undercut small businesses with minimal price reductions, I simply think they should be allowed to offer special sales and promotions if they choose to... The whole law pertains to advertized price. To the average eye, this means the standard price advertized on the main product page. To the legal eye, this means any statement of the price of the product anywhere on the company website. This includes the checkout line, where coupon codes are normally submitted. This also includes special bundle packages. While coupon codes may not be expressly disallowed (and the law probably needs to be much more specific), most retailers are not willing to take the risk of a lawsuit over a small rise in customer satisfaction...

#4 Chuck S

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Posted 21 August 2013 - 03:07 AM

MAP is indeed Minimum Advertised Price.  Nothing more.   Minimum Locked Price would be MLP.  :)

Retailers can discount or not depending on their business model and arcane things like "supply and demand."  Looking for a LM4 or RM4?  These remain in high demand and short supply so expect to pay full retail for them.  Coupons do work in my experience, though, with no manufacturer interferrence.  Many on-line retailers have a "click for our price" box or "put in your cart for our price" type of arrangement.  Or they put an additional magazine in the package.  Comparison shop always pays but stick with reputable sellers.

I bought all my KWAs below MAP and on-line thru one of these arrangements.  All but the RM4 which should be on my porch later this week.  Supply and demand again.

-- Chuck

#5 proverbialguy739

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Posted 21 August 2013 - 01:16 PM

Again, some companies consider the check out line advertizing. Thus, the retailers have no opportunity to let you discount the price, except for the rare situation where they require you to order by email (which almost no retailers do in the first place).

If kwa would send a PSA to all of their retailers expressedly allowing them to have special, time limited promotions on KWA products, this issue would be completely resolved.

Edited by proverbialguy739, 21 August 2013 - 01:16 PM.


#6 proverbialguy739

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Posted 24 August 2013 - 07:42 PM

if i could get a response from a kwa staff member i would appreciate it...




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