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Unilateral Pricing Policy (UPP)

Discussion in 'The OT' started by trh, Jul 27, 2014.

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  1. trh

    trh This Space for Sale

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    I received an email today from 1800-Contacts.

    When I mentioned this to my wife, she said her eye doctor had told her the same thing last week (and that ordering her lenses from Sam's or BJ's or 1-800-Contacts would no longer save us money).

    Later I did a Google search and saw that CNET.com and a number of other tech sites had articles about this last fall as the TV industry implemented the same policy.

    I also read that the Attorney General from Michigan released a statement that said UPP wasn't illegal.

    I suggested to my wife her response should have been 'then write me a Rx for a different brand of contacts."
     
  2. peds48

    peds48 Genius. DBSTalk Club

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    It looks like those are all from Johnson & Johnson. I used Ciba Vison contacts that I get directly from my Eye Doctor. He matches any advertised prices from known providers such as 1-800 contacts
     
  3. dpeters11

    dpeters11 Hall Of Fame

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    I would think a pricing policy within one company would be legal. Collusion with competitors would be where the issue would be I'd think.
     
  4. peds48

    peds48 Genius. DBSTalk Club

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    UPP may be the same as MSRP, which is the lowest a retailer could sell the "goods" for.
     
  5. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Club

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    I thought the S was for suggested? Selling below MSRP (manufacture's suggested retail price) is common.
     
  6. AntAltMike

    AntAltMike Hall Of Fame

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    I once heard that Janet Reno was the only person in America that insisted on paying the MSRP when she bought cars.
     
  7. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Club

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    Probably not the only person, but certainly a famous person known for that choice. She wanted to make sure that nobody thought she was getting special favors due to her position with the government. Less famous people follow a similar standard of ethics without being noticed or recognized for the choice.
     
  8. Drucifer

    Drucifer Well-Known Member

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    Price fixing across an industry is collusion and illegal.
     
  9. Eva

    Eva Member

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    It's like that with other products too.
     
  10. James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Club

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    Are they colluding with other manufacturers or just setting a price for their company's products?
     
  11. Rich

    Rich DBSTalk Club DBSTalk Club

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    Agreed, I find this pretty surprising. Sounds like the onus will be on the makers of the lenses. Reading the email, I gathered that the sellers had no choice in the matter. Also smacks of monopoly.

    Somebody will sue the manufacturers, you can bet on that.

    Rich
     
  12. Rich

    Rich DBSTalk Club DBSTalk Club

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    They must have found some sort of loophole. Corporations don't just do things. They do a lot of research and have large legal support, but they still overstep their bounds. Lawyers aren't all that smart, they just act that way. It will be an interesting lawsuit when it happens.

    Rich
     
  13. Rich

    Rich DBSTalk Club DBSTalk Club

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    The email would lead me to believe the manufacturers are behind this.

    Rich
     
  14. jimmie57

    jimmie57 Hall Of Fame

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    The list posted is all One Company, not the industry. At least that is what I interpret it to be.

    No telling how many companies do this.
    I know that Samsung does not let stores advertise below a certain price for a product which is similar to this.
     
  15. dpeters11

    dpeters11 Hall Of Fame

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    But to bargain on the price of a car isn't unethical. I seriously believe they price the sticker in expectation of it. Car dealers have established the entire dance around it. Saying "I'll have to see if the manager will go for that" etc.

    Some on this forum claim that they do this at the grocery store. There it not expected, and if I don't like the price I simply do not buy unless it's something I need (and there are some things that I an not flexible on brand).
     
  16. Rich

    Rich DBSTalk Club DBSTalk Club

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    This is what I read and formed that opinion on: A new policy, known as Unilateral Pricing Policy (UPP), is being implemented by many contact lens manufacturers. This policy regulates the lowest price we can sell their lenses for and will cause the overall price of contact lenses to increase with the elimination of sales, rebates and discounts.

    Sure sounds like it's caused by various manufacturers.

    Rich
     
  17. Rich

    Rich DBSTalk Club DBSTalk Club

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    Ever go to a Chevy dealer? I recently went to one and was told, "We don't dicker about price, the price is on the window." That's happened to me before at Chevy dealers. Needless to say, no new Chevy has ever graced my driveway. I simply don't care what price they stick on the window, I've never paid the MSRP for a car. I guess a lot of lemmings do, tho.

    People actually dicker at grocery stores? How dey do dat?

    Rich
     
  18. JosephB

    JosephB Icon

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    Just because all companies do something doesn't make it collusion. For example, all cell phone companies have usage caps, but they haven't colluded. Ever notice how airline prices always rise and fall together?

    One company makes a move, publicly in the market, and the rest follow. That is completely legal. Sucks for consumers, but that's how capitalism works.

    Another huge example of uniform pricing (and it's uniform pricing, not unilateral pricing) is Apple. You can only violate Apple prices within a few dollars. If you are an authorized Apple reseller and sell a computer or iPhone drastically under the MSRP, without their permission (they grant Walmart and other very large retailers limited permission to run short-run sales) then they will pull your vendor agreement.
     
  19. longrider

    longrider Well-Known Member DBSTalk Club

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    If this is just a new name for MAP (minimum advertised price) it is 100% legal. I deal with MAP policies a lot in my industry (powersports). While it restricts what you can advertise it for once the customer comes into the store you can sell it for whatever you want. MAP has been ruled by the courts as legal. However restricting what an independent dealer can sell a product for proabaly will not hold up to review. It has been struck down in other industries.
     
  20. trh

    trh This Space for Sale

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    Here is the CNET article I mentioned in my OP: http://www.cnet.com/news/what-is-upp-or-why-do-tvs-cost-the-same-at-every-store/

    And this from the AG of Michigan: http://www.michigan.gov/ag/0,4534,7-164-17337_20942-44650--,00.html
    And a few quotes from that page:
    Peds48 -- you said you use CIBA Vision contacts? They are listed as one of the contact lens companies that are implementing UPP. So your doctor's "price matching" won't be difficult when everyone is charging the same price.

    An industry web site says UPP is good for the profession: Offices can now focus on providing the best service/health care instead of just being the cheapest provider of lenses and UPP levels the field between the office that sells 4 pairs of brand X each year when compared to the office that sells 1000 pairs.

    EDIT: Added the MI AG link
     

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