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News, The Business “Suggested Retail Price” Will Remain Just That: A Suggestion By Lauren Sherman Friday, Mar 19, 2010 / 12:36 PM GMT -5
In 2007, the Supreme Court ruled that designers and manufacturers could fight to control how much a retailer was allowed to discount its goods.
On Thursday,
baseball caps, that decision was overturned by the Senate, who said that retailers could charge whatever they damn well please.
Why is this so important? Well, three years ago when the Supreme Court ruled that designers could demand that items are sold for a certain amount of money–i.e., Marc Jacobs could tell Saks that they MUST not mark down his classic Stam bag by any more than 50% –we were still in the midst of a spending boom. But 2008 brought recession, which meant manufacturers and designers were happy to rid themselves of product at any price. So the ruling was never really implemented, save for Louis Vuitton, who retailers would listen to regardless of the law.
What does the new ruling mean? Like in the past, designers and manufacturers can only suggest how much to charge for an item. That’s how it’s been since 1911, except for that three-year blip. Granted, most designers would never demand anything like this from a boutique or department store, simply because their support is too essential to the business.
The struggle between retailers and designers is long-documented. Retailers resent designers because many never deliver shipments on time; designers resent retailers because they mark down their goods to an embarrassing amount. The conflict is unlikely to dissipate any time soon. And that’s that, regardless of what the Senate or Supreme Court decides.
“Suggested Retail Price” Will Remain Just That
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