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Hobie Cat Australasia & resale price maintenance
http://www.hobie.com/au/en/forums/viewtopic.php?f=9&t=9145		 Page 1 of 1
Author:  BobMerrick [ Tue Apr 15, 2008 3:33 pm ]
Post subject:  Hobie Cat Australasia & resale price maintenance
Any lawyers out there know how this looks under US law?

http://www.accc.gov.au/content/index.ph ... ItemId/142
Author:  mmiller [ Tue Apr 15, 2008 5:55 pm ]
Post subject: 
The laws and the agreements are very different in Australia.

As Jeremy reported over at the Catsailor forums:

Quote:
<<It's absolutely legal here in the US to require businesses that sell your goods to not advertise prices lower than MSRP, if it is stated in some sort of 'dealer contract'. You could open your newspaper right now and find ads that have "CALL" or "Too Low to Publish Price" in the cost line. A pretty high percentage of companies have this practice here in the US, especially in the small boat industry.

That's not to say if you come down to your local dealer you won't get a deal on a boat. That's not the issue, it's the advertised pricing requirements that are the problem. Aussie laws are different than here.
I sell both Aussie boats and US boats and have read a lot about the different trade laws.

--------------------
Thanks,
Jeremy
>>


The laws were simply misunderstood over is AUS.
Author:  BobMerrick [ Tue Apr 15, 2008 6:02 pm ]
Post subject: 
I guess the moral of the story is to always call around for a better price.
Author:  MBounds [ Tue Apr 15, 2008 6:42 pm ]
Post subject: 
Quote:
The laws were simply misunderstood over is AUS.


That was a very expensive misunderstanding. $168K AUS = $155.6K US. :shock:

Time to find a new contract lawyer . . .

And maybe sue the old one for malpractice.

The joys of international business. :?
Author:  Dan P. [ Tue Apr 15, 2008 10:12 pm ]
Post subject: 
That is a conspicuously excessive penalty! I think we are looking at a judge with an agenda, who had "reasons" to put the screws to a company with US origins in the tallest manner the law would allow.

In my view, pricing laws like that appear to harm the consumer and industry at the same time. It:
-deprives the consumer of the strata of product choices we enjoy here
-reduces the incentive to innovate and invest in products, which erodes industry and employment.
-reduces the incentive for retailers to invest in proprietary market development.
-Shortens the profitability horizon (I personally have not noticed a significant amount of technology-base products coming out of Australia, maybe this helps explains why)
-Denies the premium product manufacturer the perceptive marketing advantage of excluding certain consumer classes by price point (charging resellers more, hoping they will sell it for more, is a losing strategy for obvious reasons. They need margin in order to invest!)
-Fails to recognize the need to preserve brick and mortar retail, which is essential to many products.
-Some simple, but clever products require a "skimming" strategy; i.e. where an innovative product is released at a premium, paying it's investors high-profit up front in anticipation of the inevitable China rip-off. Keeping the distribution channels in healthy margin is key to methods like this, without it, the sysem fowls as soon as online discounters debase the products (protected by AU's toxic approach to governing commerce.)

I'm not sure I agree with the malpractice angle. The defense (I am betting) was railroaded by a politically motivated / biased judge. As for the contract guy - probably a Hobie Cat insider who, using MS Word did a search and replace (US to Australia) in the US version of the agreement, to serve the AU concerns.

I gripe about the system here sometimes, but our friends in AU just gave me a good reason to be content (and a good reason to review contracts with AU distributors!)

Peace,
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