Keeping Prices High By Keeping Products Off The Web

from the the-flintstones-never-did-this dept

A small nutritional supplement manufacturer is threatening retailers that sell its products that they’ll no longer be able to stock them if they make them available for purchase or advertise pricing online. The company’s essentially trying to keep prices high by forcing customers to go to local retailers to buy them — and pay a 100% markup — rather than being able to purchase the products online from anyone who carries them. It’s a strange move, really. The company’s wholesale price it charges the vendors shouldn’t be impacted by their retail prices, so why wouldn’t it want to expand its geographic distribution as much as possible, and make it as easy as people for end consumers to buy its product? The web has a pretty solid record of making retail markets — both online and off — more efficient. Ignoring this and not taking advantage of it is short-sighted.

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Comments on “Keeping Prices High By Keeping Products Off The Web”

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Another Anonymous Coward says:

Re: vitamins?!?

If a company decides they are too good for the Internet, it’s not like I don’t have about a zillion other choices. Not online? No sale. What worries me about this article is that it suggests the EU and the WTO are actually pushing to restrict the purchase of simple vitamins!

DocMenach says:

Re: Good riddance

To say that the Nutrinional Suppliment industry is nothing but a bunch of neo-hippies is way out of line. Last I checked, in addition to “hippies” using nutritional suppliments, so do bodybuilders, people losing weight, athletes, the elderly, pregnanat/breastfeeding mothers, and many others. In fact, at the Gym I work at nutrional suppliments are a very good revenue generator, and we dont exactly cater to “hippies.”

Kasapo says:

Re: Re: Good riddance

now, now; perhaps you should quell your sarcasm a bit…note that he says ‘medicine INDUSTRY,’ not just medicine. Have you watched TV lately? I haven’t, but last I checked pharmeceutical companies were attempting to shove their drugs down the throats of the nation through advertising consisting of something like this: “Do you ever feel sad or in anyway unhappy? You may be depressed. Talk to your local pill-pusher (over-enthusiastic doctor) about Sulprema HDNXKLSKFJ today.” Followed by a list of unattractive side-effects.

The truth of the matter is that modern science isn’t really sure what the net effects of many of the drugs we so willingly advertise…they just notice a correlation in experimental groups where some effect is witnessed that may seem beneficial to some people some of the time.

Medicine: ok; Pharmillionaire (more like billion/trillion today) companies: evil greedy effects of the competition intrinsic to a capitalist society.

Howard (user link) says:

As a retailer....

I can sympathize with the effort to keep the retailers from competing with each other on the web. The vendor fears that if he allows price competition on the web, he will 1) piss off the other retailers who don’t want to sell on the web, who will then stop buying his stuff, and 2) give his product “commodity” status. Whether that’s true doesn’t really matter — he doesn’t want to take the chance. He is basically trying to protect his customers (the retail stores).

You can pull this off if you have a unique product that has good demand; it’s a bit harder for commodities. As a prior poster pointed out, the market will sort this out quite efficiently. As another prior poster pointed out, the nutritional supplements industry is so full of useless crap that we wouldn’t miss them if they went out of business (they won’t, unfortunately).

Violins and Accessories

haggie says:

No Subject Given

That’s what happens when an RIAA employee quits to start his/her own nutritional supplement business.

Probably afraid that if they sell it over the ‘net, somone might buy it and then give it to a friend and then the supplement company would have to sue because the friend didn’t buy his own bottle of the supplements.

Sum Dum Guy says:

Lots of examples

A lot of companies don’t want their products listed on the web. There’s no particular rhyme or reason, since they simply end up losing sales to the companies who do list online.

For example, Specialized Bicycles won’t allow their retailers to show prices online. They’d rather you go in person to a bike retailer and get it. To some extent, they want to make sure you’re fitted with the right size frame, but once you know that, who cares where you get it from?

Even eye doctors don’t always give you a copy of your contact lens prescription. Their claim is that can ensure quality, which most of the time is never an issue.

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