curious (or not)...
"Chris King changed their pricing policy. Simply stated, Chris King will no longer sell their products to any dealer, who will not in turn advertise a price to riders, that Chris King determines is fair. Chris King now requires all dealers to consent in writing that Chris King products will be advertised with a printed price that Chris King believes riders should pay. The new, fixed retail price is the same for all "Authorized" Chris King dealers and higher than what we would like to charge. In a phone conversation a Chris King representative stated that if we did not sign the agreement they would no longer sell their products to us.
In response to a recent rider's email about price fixing, Beth at Chris King stated:
"Thank you for your email and your support for King Precision Components. In April of 2003 we released our Dealer Agreement. Our hope was that we would be able to better support all of our dealers and their customers. We do have a suggested retail price for our products however, once a shop has purchased product from us it is theirs and they are welcome to charge a price that they see fit to their customers. We have worked very diligently to create a fair market for all our shops and their customers. Please let us know if you have any other questions. Have a great day."
Beth
Sales
King Cycle Group
info@chrisking.com
http://www.chrisking.com/prettyandstrong/index.html
1-800-523-6008
503-972-4051 (fax)
It is arrogant and repugnant that Chris King believes one way to better support riders is to fix the price at which products are sold. Would riders truly be better off by not allowing them to purchase Chris King products at a discount? Would shop owners be better off? If price fixing is such a good idea, why is it illegal?
Our experience shows that when riders are told about a manufacturer's price fixing policies, many cyclists choose to spend their hard earned money else where. We found that riders prefer products that represent a better value and come from manufacturer's who allow price competition to flourish. When Shimano turned to price fixing our Shimano sales dwindled. We in turn discontinued most of our Shimano products. However, within a year, overall component sales increased to new highs as droves of riders switched to Campagnolo.
In her email reply, Beth from Chris King, states that "once a shop has purchased product from us it is theirs and they are welcome to charge a price that they see fit to their customers" she is mis-stating the facts. First, only dealers that agree in writing to advertise Chris King products at whatever price Chris King decides is fair, are allowed to purchase products from Chris King or Chris King's distributors. Second, dealers are specifically prohibited from advertising any Chris King product at a price that is below what Chris King deems is fair. Most merchants depend upon advertising a printed price so riders know what that the item will cost. That price may be in a web or printed catalog or take the form of a retail display sign or even a price sticker. The Chris King dealer agreement states that the dealer will lose their privilege of purchasing Chris King products if they advertise a printed price lower than what Chris King states is fair. So, all dealers are not free to ch arge whatever they think is a fair price to riders.
It is illegal, a violation of our Anti-Trust laws, for any manufacturer to require retailers to sell the manufacturer's product at a price specified by the manufacturer. Chris King attempts to skirt this legal barrier by requiring dealers to agree in writing that they will not advertise Chris King products at a price lower than what Chris King wishes. This is equivalent to an oil company telling gas station owners that they are free to sell their gasoline at any price but...they cannot list the price on the pump, on their signs or anywhere else at less than what the oil company feels is a fair price. We believe that Chris King wants to force riders to pay the highest possible price for Chris King products by eliminating all price competition. They disguise their greed by cloaking it in terms of "creating a fair market for shops and customers." What reasonable person would believe a big oil company if they said "all dealers must charge what we believe is a fair price for gasoli ne. No dealer will be allowed to charge less if they wish to continue purchasing from us. Our intent is not to gouge the public but to help raise the standard of living for our gas station owners.". Why should we believe the same line from Chris King?
Beth's final comment "We have worked very diligently to create a fair market for all our shops and their customers." reveals the arrogance and possible economic illiteracy prevalent at Chris King. In a capitalist and democratic society it is not up to manufacturers to "create fair markets". Fair markets are created when consumers and suppliers are allowed to freely trade goods and services at prices that they mutually determine are reasonable. The decision regarding price should always be for the buyer to decide upon; not for the supplier to dictate. The role of manufacturers is to produce quality goods and services; not to dictate the prices consumers should pay. Once fair markets are created it is the role of government to keep the markets fair. That is why we have Anti-Trust laws that try to prevent manufacturers from fixing prices. If Chris King understands this line of reasoning, then we believe that their decision to fix prices is criminal, for they are deliberately vio lating the intent of our Anti-Trust laws. At best Chris King is economically illiterate and their decision to price fix could be viewed as a mis-guided attempt to benefit underpaid shop owners. Considering the clever legal skills they have shown in skirting our nation's Anti-Trust laws we believe it is more likely that Chris King is emulating the Robber Barons of the 19th century. They are subverting our nation's laws in a greedy attempt to line their own pockets, while gouging the bicycling public.
Many riders have emailed Chris King and refused to purchase Chris King products. We believe that the most effective way to stop price fixing manufacturers is to let the public see their policies and then decide if they wish to continue doing business with these companies."