<BLOCKQUOTE><font size="1" face="Verdana, Arial">quote:</font><HR>Originally posted by ibe27:
Can someone please settle an argument that my father and I had. The argument was on Sony's Playstation 2 (manufacture suggested retail price -$299.00). Sony promised the consumers that they will be suppling the retail business with 1 million units on the selling date. They fell short on that by half and can't make more till Christmas. Ultimetly Sony made a supply and demand for the units. The question is can Sony change the msrp higher since there is a high demand and limited playstations. My father says they can if they want more money. Is this possible? If this so what are the criteria for legally doing this? I say they can't because wouldn't that be consumer fraud. Not only that wouldn't that be considered bad business practice. What is the likely hood of a big corporation doing something like this.
thank you kindly ibe27 <HR></BLOCKQUOTE>
My response:
First, you need to know the definition of MSRP. It means "Manufacturer Suggested Retail Price". The keyword here is "suggested".
The manufacturer sets this price based on many, and variable, market demands, competition, distribution, saturation, and basically, what the market will bear. The MSRP is not set by law. The only thing set by law is that the manufacturer cannot dictate the final selling price of it's products to the retailers; i.e., "Fair Trade" pricing was outlawed years ago, and therefore cannot demand that retailers sell the products at a fixed, stationary, price.
So, the manufacturer then sells it's products to the retailer for a certain price, and then the retailer "marks up" or "discounts" the product to incorporate profits, losses, advertising, market demand, etc. If a product is "hot", the retailer may sell the product for whatever the market will bear - - despite the fact that the box price, or the MSRP price sticker, says $299.00. If the market is "hot" for a product, the retailer may sell the product for any amount it chooses. This happens, quite frequently, with automobiles. Ever tried buying a Ferrari for the MSRP price? You can forget it. That Ferrari is going to sell for at least 1/3 to 1/2 higher than the MSRP.
The MSRP is merely a guideline for consumers to use to make an informed decision on their purchase, and to make comparisons from store to store, for the same or similar products.
In summary, the MSRP is only "suggested", is not set by law, and final pricing is set by the retailer and demand within a particular market area.
Excellent question, and thanks for writing.
IAAL
------------------
By reading the “Response” to your question or comment, you agree that: The opinions expressed herein by "I AM ALWAYS LIABLE" are designed to provide educational information only and are not intended to, nor do they, offer legal advice. Opinions expressed to you in this site are not intended to, nor does it, create an attorney-client relationship, nor does it constitute legal advice to any person reviewing such information. No electronic communication with "I AM ALWAYS LIABLE," on its own, will generate an attorney-client relationship, nor will it be considered an attorney-client privileged communication. You further agree that you will obtain your own attorney's advice and counsel for your questions responded to herein by "I AM ALWAYS LIABLE."
