Retail Strategy Secret #10: Vendor Pricing

Vendor Pricing

Welcome to the tenth post in our series of “Retail Strategy Secrets”!  Here you will learn the angles, approaches, and tactics retailers are using every day to try and separate you from your hard-earned cash.  Understanding these unlocks the door to spotting great deals, and you never want to pass up a Dealicacy…

Vendor Pricing

Simply defined, “Vendor Pricing” is the act of setting product prices in accordance with and/or otherwise based on manufacturer recommendation.  As you can imagine, however, things grow more complicated from there.

Many smaller retail shops use Vendor Pricing strategies to avoid competing directly with larger retailers… In other words, to help them stay afloat and assist in touting high level of service as a differentiator instead of price. Think local gift shops and strip mall boutiques.

From the manufacturer’s perspective, this also assists in the avoiding profit-destroying price wars from the resellers of its products. Sometimes pricing is enforced loosely by the manufacturer, not at all, or very aggressively.

From the perspective of deal hunters, Vendor Pricing in any of its forms (MSRP, MAP, Prestige Pricing, etc.) – especially when aggressively enforced – can be frustrating. People like you and I who are willing to shop around for a Dealicacy seem to uncover exactly the same price at every turn.

As with all Retail Strategies, there is a way to beat vendor pricing at any level.  First, however, you must know your enemy.

In the next few posts, we’ll take a look at Dockers pants (MSRP), Bose stereos and Weber Grills (MAP), and Oakley sunglasses (Prestige Pricing)… a few of the more prominent facets of Vendor Pricing.

I’ll get started typing so I can get these published ASAP.  See you soon!

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