Price Setting vs Price Fixing

leebase · 05-19-2014, 09:59 AM

I'm in the market for a nice set of noise canceling headphones. Bose seems to be THE set to get. I actually did get the Bose QC15's (over the ear) and they are great on a plane. They are also large and I'm now looking for in ear noise canceling headphones to lighten my traveling load.

And once again, the Bose seem to be the ones to get. The QC20i is $299. Everywhere! Nobody discounts Bose products.

This, folks, is price SETTING. Bose has set the price of their product. I can buy or not buy the headphones. There are other headphones I can buy...some more expensive, some less. Some a LOT more expensive. Some a lot less expensive.

But I want the BOSE...and the price has been set. I can buy them or not. Frankly, I'm thinking NOT as $299 is a lot to pay for headphones I tend to lose or abuse (in ear headphones go in my pocket a lot).

Which made me think of the ebook "price fixing". I don't think the publishers agreed on a price to sell any particular book. Just that they went to price SETTING where you buy the ebook title you want...or you don't...but the price is SET by the publisher, not the retailer.

bgalbrecht · 05-19-2014, 10:58 AM

Price setting is not illegal, but when the top 6 publishers had meetings and other communications between them and Apple to decide how to change the pricing of ebooks, and it was the publishers' intent to raise the ebook prices to prevent cannibalization of their hardcover editions, and 5 of the publishers decided that on April 1, 2010, no retailer would be able to set their own prices, it became an anti-trust conspiracy. This has been discussed to death many times here.

fjtorres · 05-19-2014, 01:05 PM

Classic price fixing:
http://www.ft.com/cms/s/0/45c6fb66-2...#axzz32BLCl7Qq

Quote:

It said the aim of the four parties, who together hold more than 90 per cent market share in France for laundry powder, liquid and tablets, “was to stifle competition”. It described how directors from the four manufacturers regularly held secret talks in Paris hotels and restaurants, referring to each other by code names as they determined pricing and promotion policies.
“Cartel members artificially manipulated the prices,” said Bruno Lasserre, chairman of the watchdog.
Price differences between detergents were generally aligned, although two brands were allowed to be slightly more expensive. The cartel also co-ordinated promotion policies.

pwalker8 · 05-19-2014, 02:38 PM

Yea, it's been discussed many times, though some tend suppose that their conjecture about what happened is fact rather than conjecture.

EndlessWaves · 05-19-2014, 03:17 PM

Quote:

Originally Posted by bgalbrecht

Price setting is not illegal

Are you sure? I thought manufacturers determining what prices their goods were sold at in shops was illegal most of the time? Didn't they outlaw that in the 50s here in the UK?

theducks · 05-19-2014, 04:34 PM

Quote:

Originally Posted by EndlessWaves

Are you sure? I thought manufacturers determining what prices their goods were sold at in shops was illegal most of the time? Didn't they outlaw that in the 50s here in the UK?

MSRP is a suggested or cover price.
Stores (at least in the USA) are free to lower (or raise ) as costs and conditions (shortages?) warrant.
Enforcement when the supplier retaliates against the store that does not follow the suggested price is hard to prove.
Your order got lost, We are out at the moment...

speakingtohe · 05-19-2014, 05:57 PM

Perhaps the product is superior and is selling well at the MFG list price. Or there is no significant profit to be made by discounting it.

Pretty sure price setting has been common for a long time, If you want to be an authorized dealer you must do what the mfg. asks.

If there is no grey market I doubt it is because Bose has suppressed it. Just not enough potential profit to make it worthwhile perhaps.

Helen

wizwor · 05-19-2014, 09:04 PM

Quote:

Originally Posted by leebase

This, folks, is price SETTING. Bose has set the price of their product. I can buy or not buy the headphones. There are other headphones I can buy...some more expensive, some less. Some a LOT more expensive. Some a lot less expensive.

The best thing to do is to buy the best hardware at a price you are comfortable with. If you can only use the Bose phones, then you have to pay what the market will bear.

mrscoach · 05-19-2014, 09:18 PM

Each company can set their own price that they suggest the stores sell for, and can even probably tell stores that they will not be given any future business if they DON'T sell for the MSRP. Stores agree to this ahead of time, and get around it by bundling additional items for little or no extra cost. TADA, a deal.

If several companies get together, say, Wii, XBOX and Playstation, and decided that all future products would be priced in a certain range (small difference allowed) and no one must deviate from that price point or lose all business from hardware, then that is price fixing. (No, I'm not saying they have done this, they work more on my first example model)

bgalbrecht · 05-19-2014, 09:25 PM

Quote:

Originally Posted by pwalker8

Yea, it's been discussed many times, though some tend suppose that their conjecture about what happened is fact rather than conjecture.

Fact: The publishers all settled the anti-trust suit with the DOJ by admitting guilt and agreeing to penalties and post-settlement monitoring.

Fact: Apple was found guilty of anti-trust conspiracy, but is appealing the decision.

It's not conjecture that the publishers implemented agency pricing in part because they were upset about Amazon selling ebooks on the NYT bestseller list at $9.99 when the hardcover was selling for over $20.

Manabi · 05-19-2014, 10:47 PM

It's not that unusual for products like that to be the same price everywhere day-to-day. Where you get differences is sales, and those will probably be loss-leaders to get customers to the store in hopes they'll buy other stuff too. Electronics items tend to have very low markups, where stores make their money is cables and accessories. Cheap headphones might have a better markup, but I doubt the high-ticket ones do. They're probably low-profit like regular electronics are.

Your best bet would be to wait for a sale, although $200+ for in-ear headphones seems insane to me no matter what.

leebase · 05-20-2014, 12:09 AM

Saying "you must sell this Harry Potter ebooks for $29.99" is setting the price of the product. That you can't go anywhere and find a deal on Harry Potter does not mean the price was fixed...only that it was set. You could go buy Lord of the Rings or any other book.

Coordinating the price setting deals each publisher was working out with Amazon...that is what they did wrong.

leebase · 05-20-2014, 12:13 AM

As for the. Bose in-ear. Last plane ride I couldn't hear the movie on my iPad even with my Apple in-ear headphones. I had left my Bose over-the-ear headphones at home due to the need to save space. Only now I couldn't enjoy a movie. Thus my search for noise canceling in-ear headphones. And yes, $299 is more than I want to spend so I'm going to try an in ear noise-isolating type for half the price. Nobody has the Bose on sale....nobody. Which reminded me of the price-fixing debate here

AnemicOak · 05-20-2014, 12:32 AM

Bose is great at marketing and has built a brand that retailers generally don't feel the need to discount. Many audiophiles feel that while their products aren't bad they are overpriced for what you get compared to competitors (mainly their home theater stuff), but this doesn't matter with the general market where the Bose name is often associated with the best. They have put out some very well regarded noise cancelling stuff lately (the QC20i's are considered some of the best in that price range) and retailers don't have to discount it to sell it. It's a premium branded product with a smaller markup than some brands and consumers at a certain level seek it out without sales. That said various retailers do have Bose sales from time to time. Amazon had a Bose winter sale. Crutchfield, Onecall and others also sometimes have sales on Bose stuff. The $280 earbuds (Bose has dropped them to $279) are something retailers don't feel the need to discount. BTW, watch out if you find very highly discounted QC20i's as there are fakes on the market.

drjenkins · 05-20-2014, 06:08 AM

Quote:

Originally Posted by leebase

The QC20i is $299. Everywhere! Nobody discounts Bose products.

Amazon has them for $279.00 with free shipping.
http://www.amazon.com/Bose-QuietComf...rds=bose+qc20i

They also have them for $253.95 ($222.96+$30.99).
http://www.amazon.com/Bose-Noise-Can...rds=bose+qc20i

05-19-2014, 09:59 AM	#1
leebase Karma Kameleon Posts: 2,960 Karma: 26738313 Join Date: Aug 2009 Device: iPad Mini, iPhone X, Kindle Fire Tab HD 8, Walmart Onn	Price Setting vs Price Fixing I'm in the market for a nice set of noise canceling headphones. Bose seems to be THE set to get. I actually did get the Bose QC15's (over the ear) and they are great on a plane. They are also large and I'm now looking for in ear noise canceling headphones to lighten my traveling load. And once again, the Bose seem to be the ones to get. The QC20i is $299. Everywhere! Nobody discounts Bose products. This, folks, is price SETTING. Bose has set the price of their product. I can buy or not buy the headphones. There are other headphones I can buy...some more expensive, some less. Some a LOT more expensive. Some a lot less expensive. But I want the BOSE...and the price has been set. I can buy them or not. Frankly, I'm thinking NOT as $299 is a lot to pay for headphones I tend to lose or abuse (in ear headphones go in my pocket a lot). Which made me think of the ebook "price fixing". I don't think the publishers agreed on a price to sell any particular book. Just that they went to price SETTING where you buy the ebook title you want...or you don't...but the price is SET by the publisher, not the retailer.

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05-19-2014, 10:58 AM	#2
bgalbrecht Wizard Posts: 1,806 Karma: 13399999 Join Date: Aug 2007 Location: US Device: Nook Simple Touch, Kobo Glo HD, Kobo Clara HD, Kindle 4	Price setting is not illegal, but when the top 6 publishers had meetings and other communications between them and Apple to decide how to change the pricing of ebooks, and it was the publishers' intent to raise the ebook prices to prevent cannibalization of their hardcover editions, and 5 of the publishers decided that on April 1, 2010, no retailer would be able to set their own prices, it became an anti-trust conspiracy. This has been discussed to death many times here.

05-19-2014, 02:38 PM	#4
pwalker8 Grand Sorcerer Posts: 7,196 Karma: 70314280 Join Date: Dec 2006 Location: Atlanta, GA Device: iPad Pro, iPad mini, Kobo Aura, Amazon paperwhite, Sony PRS-T2	Yea, it's been discussed many times, though some tend suppose that their conjecture about what happened is fact rather than conjecture.

05-19-2014, 05:57 PM	#7
speakingtohe Wizard Posts: 4,812 Karma: 26912940 Join Date: Apr 2010 Device: sony PRS-T1 and T3, Kobo Mini and Aura HD, Tablet	Perhaps the product is superior and is selling well at the MFG list price. Or there is no significant profit to be made by discounting it. Pretty sure price setting has been common for a long time, If you want to be an authorized dealer you must do what the mfg. asks. If there is no grey market I doubt it is because Bose has suppressed it. Just not enough potential profit to make it worthwhile perhaps. Helen

05-19-2014, 09:18 PM	#9
mrscoach Guru Posts: 767 Karma: 4837659 Join Date: Aug 2009 Location: San Angelo Texas Device: Samsung Galaxy tab	Each company can set their own price that they suggest the stores sell for, and can even probably tell stores that they will not be given any future business if they DON'T sell for the MSRP. Stores agree to this ahead of time, and get around it by bundling additional items for little or no extra cost. TADA, a deal. If several companies get together, say, Wii, XBOX and Playstation, and decided that all future products would be priced in a certain range (small difference allowed) and no one must deviate from that price point or lose all business from hardware, then that is price fixing. (No, I'm not saying they have done this, they work more on my first example model)

05-19-2014, 10:47 PM	#11
Manabi Wizard Posts: 1,384 Karma: 18484273 Join Date: Apr 2013 Device: Paperwhite, Galaxy S22	It's not that unusual for products like that to be the same price everywhere day-to-day. Where you get differences is sales, and those will probably be loss-leaders to get customers to the store in hopes they'll buy other stuff too. Electronics items tend to have very low markups, where stores make their money is cables and accessories. Cheap headphones might have a better markup, but I doubt the high-ticket ones do. They're probably low-profit like regular electronics are. Your best bet would be to wait for a sale, although $200+ for in-ear headphones seems insane to me no matter what.

05-20-2014, 12:09 AM	#12
leebase Karma Kameleon Posts: 2,960 Karma: 26738313 Join Date: Aug 2009 Device: iPad Mini, iPhone X, Kindle Fire Tab HD 8, Walmart Onn	Saying "you must sell this Harry Potter ebooks for $29.99" is setting the price of the product. That you can't go anywhere and find a deal on Harry Potter does not mean the price was fixed...only that it was set. You could go buy Lord of the Rings or any other book. Coordinating the price setting deals each publisher was working out with Amazon...that is what they did wrong.

05-20-2014, 12:13 AM	#13
leebase Karma Kameleon Posts: 2,960 Karma: 26738313 Join Date: Aug 2009 Device: iPad Mini, iPhone X, Kindle Fire Tab HD 8, Walmart Onn	As for the. Bose in-ear. Last plane ride I couldn't hear the movie on my iPad even with my Apple in-ear headphones. I had left my Bose over-the-ear headphones at home due to the need to save space. Only now I couldn't enjoy a movie. Thus my search for noise canceling in-ear headphones. And yes, $299 is more than I want to spend so I'm going to try an in ear noise-isolating type for half the price. Nobody has the Bose on sale....nobody. Which reminded me of the price-fixing debate here

05-20-2014, 12:32 AM	#14
AnemicOak Bookaholic Posts: 14,391 Karma: 54969924 Join Date: Oct 2007 Location: Minnesota Device: iPad Mini 4, AuraHD, iPhone XR +	Bose is great at marketing and has built a brand that retailers generally don't feel the need to discount. Many audiophiles feel that while their products aren't bad they are overpriced for what you get compared to competitors (mainly their home theater stuff), but this doesn't matter with the general market where the Bose name is often associated with the best. They have put out some very well regarded noise cancelling stuff lately (the QC20i's are considered some of the best in that price range) and retailers don't have to discount it to sell it. It's a premium branded product with a smaller markup than some brands and consumers at a certain level seek it out without sales. That said various retailers do have Bose sales from time to time. Amazon had a Bose winter sale. Crutchfield, Onecall and others also sometimes have sales on Bose stuff. The $280 earbuds (Bose has dropped them to $279) are something retailers don't feel the need to discount. BTW, watch out if you find very highly discounted QC20i's as there are fakes on the market.

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