Quote:
Originally Posted by shalym
Did you bother to look at the link I provided to Amazon's Kindle resale program? There is absolutely no minimum price requirement mentioned for selling Kindles.
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Amazon can be a bizarre company, and that was a bizarre link. Hardly anybody is going to sell with such a low markup, even before considering the $1.00/item shipping charge, and hardly anybody does. It would be cheaper to buy at retail, with the ten percent AARP discount, than this so-called wholesale. Even Costco, which makes all its profit from the membership fees and is famed for retail efficiency, requires a 14 percent markup. A small business is not that efficient and so needs a bigger markup to break even, let alone make a profit.
Price maintenance terms are most commonly in the advertising allowance, not mentioned in your link.
Your link has nothing to do with the advertised Kindle prices at Staples, Best Buy, and Office Depot.
Having said all that, I suspect that there is no advertising allowance with this small business program, and that a bold neighborhood hardware store, participating in this program, could in fact give a heavy loss leader discount on Kindles. Amazon is probably willing to take that small risk of their devices being locally cheapened.
Part of the lesson to big publishers, of this kind of discussion, is that consumers have a pretty strong tolerance for price maintenance as long as you are quiet about it, and allow limited discounts. Maybe, if Hachette is still negotiating over agency with Amazon, they should offer say, a 15 percent discount 20 percent of the time, which is more like the typical price maintenance deal. The problem with that, from the perspective of a publisher who has read
The Everything Store, is that you can't trust Amazon to abide by the fine print of complex price maintenance agreements. And you can't sue for such violations because it would generate horrible publicity.