Boycott Wellness! They're price fixing

[LostinVA]

The nice local store we buy our pet food from has a HUGE sign out front of the store, saying to boycott Wellness. Inside, they posted the legal letter sent to them by Wellness. Wellness is stopping all shipments to their store, because one flavor of the BIG bags of dog food was being sold for TWENTY CENTS below their listed price.

I was shocked, because I always really liked this brand. Now, I'm really glad I switched to Evo/Merrick.

[elleng]

1. WHAT

is 'price fixing?'

http://en.wikipedia.org/wiki/Price_fixing

[huskerlaw]

2. Ugh.

My cats eat Wellness. And one of them is REALLY picky. *grumbles*

[LostinVA]

3. Even my picky cat likes the EVO dry

The other one eats the EVO canned food. He has IBS, and it's pretty much the only non-prescription food (which was filled with crap & making him fat) he can eat without throwing up. So he gets EVO canned, with the occasional can of Tiki Cat sardines as a treat.

It's about the same price as the Wellness.

[bicentennial_baby]

4. Hmmm. If they had an agreed upon price, and the store

was not holding up their end of the agreement, then I see Wellness's point. .20 isn't a big deal though, although I'm sure it adds up. I'd really need more information before making a judgment though.

[LostinVA]

5. They were selling it for twenty cents below the MRP

They were paying the same wholesale price for it, just selling it slightly cheaper. What Wellness is doing is price fixing.

This isn't PetSmart or anything they're going after. It's a little mom & pop place.

[bicentennial_baby]

6. That's unfortunate...What was the store's rationale for the .20 drop?

This confuses me, I admit. I don't see how dropping the price of the large bags of food by .20 is going to make any measurable difference in their profit margins, unless it's in extremely high demand. :shrug:

[LostinVA]

7. I don't know the rationale

Their prices are always pretty good, though.

[China_cat]

8. It doesn't make any difference to Wellness' profit margins.

They get paid the same no matter what the customer sells it for. If I buy supplies for my business, the vendor gets paid his/her price even if I decide to sell it below cost in order to entice people into my shop.

In effect, they are telling the customer what they HAVE to sell it for. That's illegal.

Edited to add: This is restraint of trade, not price fixing, however. Price fixing is when 2 or more supposedly competing companies agree to charge the same price for their goods.

[bicentennial_baby]

10. No, I was referring to the profit margin of the store in question

And you are correct, it is not price fixing.

[China_cat]

11. What I was saying is that it shouldn't make any difference

to Wellness what the store's profit margin is. Or what they sell it for as long as Wellness gets their price for it.

Yes, it might shorten that store's profit margin on that product, but maybe being able to buy that one item at a .20 saving pulls in customers that might not have otherwise come in and makes up for it in other sales.

[China_cat]

9. That's M-S-RP

Manufacturer's SUGGESTED Retail Price.

[Bluestar]

12. From my many years in the manufacturing/retail arena

the two parties are not allowed, by law, to have an "agreed upon price". Manufacturers can suggest (or even print on the product) a suggested retail price. But it is against the law for a manufacturer to pressure a retailer in any way for offering discounted prices.

Retailers are allowed to charge as much or as little as they wish for products that they choose to re-sell. This gets sticky as manufacturers are also allowed to discontinue doing business with any retailer that they deem unsatisfactory to sell their products. But it becomes unlawful when the issue of offering discounted pricing is the reason given for refusing to sell to a retailer.

I thought Wellness was up to something. Their canned cat food has gone from about $23 per case to $30 per case at my local pet "foodatorium". I'm switching to California Naturals.