Recently the Supreme Court ruled in favor of lifting a long standing ban on minimum pricing agreements. In other words, the Court has said it’s OK for manufacturers and suppliers to set pricing levels and enforce them – if they’re found to promote competition. This article describes several sides of the issue (Link here).
This decision has many implications for eBay selling in particular. In eBay auction listings, the price starts from the bottom up — sellers usually start a price as low as possible and let the bidders work up to the final price. This flies in the face of set pricing controls since the actual ending price cannot be determined in advance by seller.
The most common form of pricing control is MAP pricing as described in an earlier blog post (Link Here). MAP pricing forces (by agreement) the retailer to refrain from the showing the price of an item as any amount less than what is set as MAP. This doesn’t fit cleanly into the eBay auction listing model either. If you sell on eBay and run into a supplier and/or manufacturer who have some sort of set pricing controls, they now have the Supreme Court decision to back them up.
If this causes you problems, consider using eBay’s “Best Offer” feature. This lets buyers submit their best offer to you and you can decide whether or not to accept them. Once you accept one, the item is considered sold. The Best Offer feature is available with a Fixed Price listing (either standard listing or Store listing).
Best Offer lets you show one price and sell it at another – the best offer price. Since the price displayed can be set up to satisfy the manufacturer’s set pricing, it should keep you out of trouble at least for most forms of MAP pricing. eBay also offers a setting that will let you automatically reject any offers below a certain point. If you use Best Offer make sure to set parameters on how low you will go and still make a profit.
Tags: Manufacturer Pricing Controls, eBay Selling, eBay Best Offer, eBay MAP Pricing