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Steven78
22-12-2007, 11:09 AM
Just got this via email.
Court penalises Navman
The company responsible for supplying one of Australia's most popular Christmas gifts has been penalised more than $1.2 million by the Federal Court for concerning conduct.
Navman Australia Pty Ltd is a supplier of marine, personal and in-car navigational equipment with dealership and retail arrangements across the country.
A statement issued by the Australian Competition and Consumer Commission (ACCC) said Navman and its employees were engaged in resale price maintenance, where a supplier prevents or discourages retailers from discounting the price of their goods.
Navman admitted it tried to ensure dealers did not sell its marine products for less than a benchmark price and that it had cut off supply to some retailers who did not comply with requests, the ACCC said in its statement.
The company and its employees had also tried to prevent the online sale of its in-car navigation systems below a certain price.
In orders consented to by both parties, Navman was fined $1.25 million by the Federal Court, while former senior executives faced personal fines of up to $80,000.
"The details of the contraventions show that Navman's conduct was not merely deliberate. It was pursued in an aggressive and high-handed way by the company's most senior managers," Federal Court Justice Peter Jacobson said in his judgment.
Navman products are included in this year's Dick Smith Electronic's top 10 list of Christmas gifts alongside MP3 players and game consoles.
A Navman spokeswoman said the incidents occurred "some time ago" and the company had since moved forward.
"Ownership has now been transferred, splitting the management of marine, in-car and other navigation systems," she told AAP.

Fafnir
22-12-2007, 12:15 PM
How does a decision like this then relate to companies like Daiwa for example who have minimum retail prices on their Tournament range of products? A practice that I actually agree with.

Fitzy
22-12-2007, 02:24 PM
That happened 18 months or 2 years ago.

mik01
22-12-2007, 04:21 PM
How does a decision like this then relate to companies like Daiwa for example who have minimum retail prices on their Tournament range of products? A practice that I actually agree with.

you can suggest a rrp, and most retailers will comply, however you cannot coerce anyone to sell at a mandated price.
therefore, the minimum price is 'recommended' only, whereas Navman actually coerced and eventually cut off supplies to retailers who decided to reduce their margins and offer lower prices to consumers.
this is highly illegal and as you can see, subject to heavy fines.
the two are totally different.

tunaticer
22-12-2007, 05:37 PM
It would be interesting to see the difference between actual costs, RRP and the sale prices for most goods.

I think here in Australia we are being told a huge amount of lies about "global" prices. Commonly we are paying a heavily inflated price for items costing, in some cases, several hundred percent overseas for exactly the same product. The fishing tackle industry is a very minor market with relatively small savings to be made by buying overseas.

In the engineering field we are commonly paying several hundred to several thousand percent more for items of machinery and being told we are paying "global prices" by the Australian distributors. For example, I can buy a 8 metre long 10" diameter screw conveyor with motor and gearbox and inlet and outlets flanged to my specifications from ITALY, ready to bolt into place here, AIRFREIGHTED to Melbourne then road freighted to Brisbane for $6500.00. For my to buy the flights the inner and outer tubes and flanges and drives I will spend in the order of 6500 to 7000 dollars with no freight or labour costs entailed. How can we believe that we are paying those so called "global prices" if we can not compete with a non-Asian country like Italy?

As for price fixing, I believe that if we got into the nitty gritty of most products we can find cases of exorbitant fees or charges.

Jack.

Steven78
22-12-2007, 06:29 PM
Its funny how some suppliers control there inports and dont allow allow warranties from overseas companys. We are now in a globle economy i class this as form of price fixing. Its funny how prices go up by 100-200% for inports. Someone is make to much money.

snelly1971
22-12-2007, 07:07 PM
Totally agree Steven78....Thats why i buy from the States...

Mick

Fafnir
22-12-2007, 07:16 PM
you can suggest a rrp, and most retailers will comply, however you cannot coerce anyone to sell at a mandated price.
therefore, the minimum price is 'recommended' only, whereas Navman actually coerced and eventually cut off supplies to retailers who decided to reduce their margins and offer lower prices to consumers.
this is highly illegal and as you can see, subject to heavy fines.
the two are totally different.

But unless I am mistaken, in Daiwa's case if a Tournament Dealer attempts to sell under the list retail price they risk losing their dealership. Pretty sure it's more than a simple 'recommended retail price'.

As I said I am not against companies saying 'my product is worth X, I don't want it devalued by a retailer slashing the prices on it'. Just curious.

FNQCairns
22-12-2007, 07:27 PM
Think it's possible to buy the V8 comodore O/S and ship it here for less overall than driving it away from an Aussie dealer! Something is very wrong when that is the case.
Didn't our last government pull some of the ACCCs important teeth in interest of comprehensive dishonesty, Navman would probably get away with it today as would others.

cheers fnq

mik01
22-12-2007, 08:39 PM
But unless I am mistaken, in Daiwa's case if a Tournament Dealer attempts to sell under the list retail price they risk losing their dealership. Pretty sure it's more than a simple 'recommended retail price'.

As I said I am not against companies saying 'my product is worth X, I don't want it devalued by a retailer slashing the prices on it'. Just curious.

that would be a classic case of price managing. I would be highly surprised if this was a bona fide policy of Daiwa and if it is, then it is a matter of time before it gets called into question.

my money is on the fact that its not a policy of Daiwa at all, and that the list retail price is merely 'highly recommended'. read this for clarification http://www.accc.gov.au/content/index.phtml/itemId/322982/fromItemId/3669

this sums it up -
'Any arrangement between a supplier and a reseller that means the reseller will not advertise, display or sell the goods the supplier supplies below a specified price is illegal.'

dodgyone
22-12-2007, 10:21 PM
that would be a classic case of price managing. I would be highly surprised if this was a bona fide policy of Daiwa and if it is, then it is a matter of time before it gets called into question.

my money is on the fact that its not a policy of Daiwa at all, and that the list retail price is merely 'highly recommended'. read this for clarification http://www.accc.gov.au/content/index.phtml/itemId/322982/fromItemId/3669

this sums it up -
'Any arrangement between a supplier and a reseller that means the reseller will not advertise, display or sell the goods the supplier supplies below a specified price is illegal.'


Most of your local tackle shops are keen to do a good deal. Especially on top end items like team Daiwa gear. My local cant discount Team Daiwa stuff due to his agrrement with Daiwa but if you buy a rod at the same time it will be well under his cost price. There are ways around it.

Chris Ryan
23-12-2007, 05:06 AM
I just bought a Navman GPS unit here in Brisbane from a retail outlet for my boat. I shopped around on the net and was doing the conversions from the US outlets + freight and I ended up buying the same unit in Australia for the same price. Sometimes it just takes some leg work but you find the deals.

Merry Christmas and Tight Lines
Chris

bigbrian47
23-12-2007, 06:13 AM
chris that is the case with navman now they are owned by brunswick
a huge corporation that owns mercury among many other companies
when i bought my navman gps from the states about 3 yrs ago
mine was $930AU landed here
the best i could buy it was around $1,800AU here
can buy the same unit cheaper than $930AU here now
i think the importing agents rather than the retailers are making good dollars
cheers brian

Chris Ryan
23-12-2007, 09:51 AM
Thanks for that info bigbrian. In some ways it at least levels the playing field to have like for like pricing across the globe. The importers might well be making some bucks (and I would too if I was them) but at least the consumer is no longer being penalised.

I just hope the importers are at least letting the retailer make their living too.

Cheers, Chris

oldboot
24-12-2007, 10:40 AM
Price and margins and dealer relationships vary from product to product and across various industries.
Some areas we get a fairly good crack compared to overseas....... powertools for instance we do pretty well on compared to UK and US for the majority of brands.
considering exchange rates and stuff we pay about the same or better for most powertools.

Other areas I know we do very badly, music & software are prime examples.

There are a lot of complexities in the way stuff is sold.

Is the wholesaler buying a fully supported product
or
Does the wholesaler bear the waranty cost localy

hence the overseas waranty issue.

Is the whoesaler simply an arms length distributer
or
Does the wholesaler provide significant dealer and customer support.

Is the product baught outright by the retailer
or
is the product placed on a consignment or financed by the distributer
or
Is the product sold by the retailer as an agent for the distributer.

For most volume products ther is a standard wholsale price, just like there is a standard retail price....... yeh all fine & beaut.
then you consider the extra discounts, merchandising payments, advertising subsidies and a host of other deals.

It is very easy to "make it worthwhile" for a retailer to tow the line without withdrawing supply.

So in certain situations
The wholsale will be retail less 30%.... a fair margin.
If there is a volume buy from some suppliers ther may be an additional 10%, 20% 30% for quantity breaks.
less 6% for immediate settlement.
This is for lots or mass produced comodity product.

for a premium product
the retailer will buy at normal margin ( whatever that is) for some product with very little in the way of quantity deals.
But
Other supporting product will be supplied at absolutely screaming deals.
The wholsaler may.
provide significant advertising subsidy.....of if you see an independant retailers add that has product all form one supplier... you can bet this is the case.

provide very substancial merchandising support, shop fittings, sign writing, wholesaler staff assisting in store or at trade shows or even paying a "rent" for the floor space on the store.

Then there are rebates and wholesaler clearances

the arrangements and the profit margins and profit distribution is such a wildly variable thing.

You also have to remember that the sales volume in this country is very small compared to other countries.

many of our retailers dont even buy direct wholesale.
I know of product that local " importers" do not buy direct wholesale but form a retalier in other countries with distributer status..... because they cant even approach the volume.

Consider that for many products one single american stste shifts more stock than our whole country.


OHHH the tangled web............ are you sure you realy want to know????

cheers

Mister
24-12-2007, 01:58 PM
chris that is the case with navman now they are owned by brunswick
a huge corporation that owns mercury among many other companies
when i bought my navman gps from the states about 3 yrs ago
mine was $930AU landed here
the best i could buy it was around $1,800AU here
can buy the same unit cheaper than $930AU here now
i think the importing agents rather than the retailers are making good dollars
cheers brian

So Brunswick owns Navman do they?

bobp
24-12-2007, 07:30 PM
So Brunswick owns Navman do they?

they did but navmans marine divsion is now owned by navico who also own simrad and eagle/lowance

bob

Chris Ryan
24-12-2007, 08:19 PM
Hey Oldboot,

Mate I understand it first hand. I run a QLD branch office for an IT company that both wholesales and retails. Depending on partnership levels with manufacturers (which is made up of technical qualifications and volume of sales) the purchasing price is quite variable between resellers.

Also some products are now just naturally low in profit due to market pressures; for one, computers have almost zero margin/profit. On a $1000 computer, we are lucky to make $60 profit and then have to support it's warranty etc out of that $60. This is why you find some suppliers have poor service as they can't fund that out of their sale price; others like ours have such a diverse range that we can shuffle profit and ensure customer service is always first paid for.

Anyway, Merry Christmas.
Chris

So