Klarinet Archive - Posting 001060.txt from 2004/07

From: "Kevin Fay" <kevinfay@-----.com>
Subj: [kl] Yamaha & MAP
Date: Thu, 29 Jul 2004 17:36:23 -0400

Blumberg posted:

>I'm feeling more and more like Yamaha is one stupidly run company!
>They have this thing called "MAP" pricing which is the "publicly written"
>pricing that can go into a catalog now. Buffet is doing the same bit.
>Problem is that this printed pricing is only the Retail Price!! So you see
>the retail price along side of "purchase it for only" which is the same
>high cost.

MAP = Minimum Advertised Price. It some circumstances, it's the "estimated
retail price," better known as "list" or "sticker" price. What it means is
simple - Yamaha won't allow catalog retailers to advertise a price lower
than the this price.

Why? Not because they stupidly believe that anyone with an IQ higher than a
house plant will pay it. They do it to protect neighborhood retailers.
That's supposed to be a good thing.

The #1 thing a company can do to kill the profitability of their local sales
outlet is to let Woodwind & Brasswind print the real street price in their
catalog. It won't increase WW&BW's sales - those in the know will call, get
the street price and buy there anyway. What kills the local retailer is
having the local band director photocopy pages of the catalog (with the
street price) and dole them out to parents. When Mom & Dad stroll into the
neighborhood music store with the WW&BW catalog in hand, they'll demand the
same street price - which is often *lower* than the price that the local
retailer buys the thing from their distributor! The store can't match
WW&BW's price without selling below cost - and selling below cost is a quick
road to bankruptcy.

Yamaha also has a separate "Allegro" line that is sold *only* through
storefront retailers, and they've enforced a strict minimum price policy so
that all retailers can profit from their sale. Enforcing minimum pricing is
difficult, however, and in some circumstances illegal as "resale price
maintenance."

Does it work? Only some. Any commercial transaction based on inequality of
information won't run efficiently in the long run. Along the way, however,
the local stores will make a little bit more profit selling above WW&BW's
street price.

Yamaha is taking pains to try and keep the local music stores profitable in
a climate where discounters can sell the same instruments for less and
discount super-stores can sell shoddy imports for next to nothing. Perhaps
the execution could be handled better, sure - but what they do with the MAP
should be recognized for what it is, an attempt to help the distribution
chain survive.

They also make a really fine clarinet. I recommend trying the CSV.

kjf

Kevin Fay
kevinfay@-----.com

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