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03-29-2012, 10:05 AM   #1
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Pentax Unilateral Pricing Policy

On the front page, we've got an announcement that like Nikon and Sony, Pentax is switching to a unilateral pricing policy, where they will stop selling cameras to retailers who sell them below a certain price. In effect, what does this mean?

Do you think it will accompany a general drop in prices in the MSRP with the lenses? Because if not, the list price on amazon of a 16-50mm 2.8 for example is $1500, but the actual price is $800. Does that mean with this new policy that Amazon would have to jack up the price on that lens by almost double?

03-29-2012, 10:12 AM   #2
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I don't think the prices will jump that much, but truthfully, I don't know. If B&H or Adorama buy a lens from Pentax and sell it for $800 and both Pentax and the reseller are making profit, then I don't see a reason to jump the price up much higher than it is.
03-29-2012, 10:18 AM   #3
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It's that the Apple model for pricing?
03-29-2012, 10:21 AM   #4
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Yes, there will be a certain minimum price they will have to adhere to, this may not be MSRP in all cases. As the news story suggests, the price of many items will go up.
It does not mean that you won't be able to ever purchase a lens below the minimum price, it's just likely that when you do, it is because Pentax has a rebate going on.

On the up-side, this is one factor which could/should lead to more Pentax in brick & mortar stores in the US. Many of the prices you see at B&H/Adorama/etc. are seriously low-ball offers (especially on lenses), a normal retail store has no incentive to carry Pentax if they're constantly being forced to match the prices of those stores. The same thing can happen with Canikon...but no "respectable" camera store is going to drop Canon or Nikon over this issue...the same cannot be said for Pentax unfortunately.

So ultimately it is a trade-off between price and accessibility. IMO lenses and cameras sell better when they're in the hands of the user before purchase, I think Ricoh agrees.


Last edited by Mock; 03-29-2012 at 10:31 AM.
03-29-2012, 10:22 AM   #5
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It means that local dealers (brick and mortar) will be willing to sell Pentax again.

Why would Ritz/Wolf/Shutterbug even bother trying to sell a K-5 at $1300 when you can find it on the internet for $1000? (these prices are examples, what matters is that one is higher and the other significantly lower).

If it cost the same $1300 at Amazon and Ritz, then a buyer would be more likely to stop by the mall to buy from Ritz today. Therefore, Ritz is willing to keep inventory.
03-29-2012, 10:35 AM   #6
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Is this just a US policy change? I am not sure this practice is legal in the EU is it?
03-29-2012, 10:36 AM   #7
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It will also, indirectly, impact used lens prices if what is being said is true. If the new price is higher than a used lens will sell for a portion of that price and end up costing more as well. Ah well.
03-29-2012, 10:39 AM   #8
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Does this mean I should go and get that DA*55 right now ?

I don't mind the whole pricing change; I don't want the k-5 right now and I can afford the price increase in the future. If it means Pentax gets more growth, then so be it.

03-29-2012, 10:58 AM   #9
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QuoteOriginally posted by Caat Quote
Is this just a US policy change? I am not sure this practice is legal in the EU is it?
It isn't legal in the EU. However, it is legal to not ship to certain dealers w/o ever explaining why. It's not legal if it is in a contract. So, if a dealer is too important to be ignored, he cannot be forced to sell at any given price in EU. Exceptions exist like for bookstores or pharmacies.

Many dealers may still give you a discount on a deal with many items, officially listing the locked price items at their full price but discounting other items heavily. Or there may be a batch of discounted items, e.g., from customer returns, which however are new in box.

As for Nikon pricing in the US, I loked up one example:
MSRP for the Nikkor 70-200/2.8 GII is $2,399.95
B&H price is $2,396.95 with a free $66.69 value filter pack. So, this is 3% discount.

B&H offers many Nikon lenses from import, often cheaper. But not this lens, imported is same price.

Lowest price in Germany is 1873€ or (excl. tax) $2090 which is a 13% discount over the US MSRP.

Last edited by falconeye; 03-29-2012 at 11:11 AM.
03-29-2012, 11:06 AM   #10
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I've always given preference (and paid more) to the local shop. But there's a limit, particularly with a 5.5% sales tax. I expect that this will bring local and Internet prices closer and I'd be glad to see more incentive to the local shop to sell/stock more Pentax. Bodies.

But what happens for lenses? If this means an across-the-board increase in Pentax lens prices, Sigma et al. will benefit from a greater price advantage. Would that give Tamron, for example, more incentive to bring Pentax mounts to the market?

Skilled product and offer management at Pentax (whose existence has long been questioned by some) should be able to use that approach to fine tune the new "universal" price. They should not jump pricing where Sigma, Canon, and others have good competitive offers for lenses and entry-level bodies, but they may well do for mid-range bodies and unique, e.g., Limited, glass.

I really don't think that they'll shoot themselves in the foot here but neither do I think that all US-based Pentaxians (and those who purchase from the US) will be happy with all the changes.

My budget just got punctured, alas, so I'm waiting a bit nervously.
03-29-2012, 11:13 AM   #11
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QuoteOriginally posted by falconeye Quote
It isn't legal in the EU. However, it is legal to not ship to certain dealers w/o ever explaining why. It's not legal if it is in a contract. So, if a dealer is too important to be ignored, he cannot be forced to sell at any given price in EU. Exceptions exist like for bookstores or pharmacies.

Many dealers may still give you a discount on a deal with many items, officially listing the locked price items at their full price but discounting other items heavily. Or there may be a batch of discounted items, e.g., from customer returns, which however are new in box.
My understanding of the Supreme Court reversal of the 190X ruling is similar to what you've described. It seems based on the concept that sellers don't have to sell to all buyers. Pentax cannot walk into a retailer and change price tags but they can drop that retailer as an authorized dealer and, if they don't get the hint, refuse to take more orders from that retailer.

The loss of the AD designation may not be a big deal right now as purchase from one doesn't seem to bring much, if any, value. But if Pentax USA decide to limit warranty or other service to goods purchased though ADs, we have a whole new situation. Before too many people get too excited, I think that Pentax USA are OK with goods purchased through your local shop (not an AD on the Web site) as long as the shop obtains its stock through an authorized distributor. That's the case with mine.
03-29-2012, 11:15 AM   #12
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this isn't legal in Canada either Falk. AFAIK it's not legal in the US either.
You can have a MAP agreement (minimum advertised price) and in fact Nikon and Canon both have those in place. It's quite common. It doesn't stop a dealer selling below a price just advertising below that price (and it's beneficial to B&M guys who have to go head to head with the web in the states where people avoid state tax by shopping cross border on the web. If MAP holds pricing a little then the B&M guy can probably find a way to represent value to offset the tax issue (I still can't believe this deal exists in the US, nowhere else I know of lets this happen)
03-29-2012, 11:19 AM   #13
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QuoteOriginally posted by eddie1960 Quote
(I still can't believe this deal exists in the US, nowhere else I know of lets this happen)
Jefferson's original draft of the Declaration of Independence did read "Life, Liberty and the Pursuit of Money"...
03-29-2012, 11:20 AM   #14
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QuoteOriginally posted by falconeye Quote
It isn't legal in the EU. However, it is legal to not ship to certain dealers w/o ever explaining why. It's not legal if it is in a contract. So, if a dealer is too important to be ignored, he cannot be forced to sell at any given price in EU. Exceptions exist like for bookstores or pharmacies.

Many dealers may still give you a discount on a deal with many items, officially listing the locked price items at their full price but discounting other items heavily. Or there may be a batch of discounted items, e.g., from customer returns, which however are new in box.

As for Nikon pricing in the US, I loked up one example:
MSRP for the Nikkor 70-200/2.8 GII is $2,399.95
B&H price is $2,396.95 with a free $66.69 value filter pack. So, this is 3% discount.

B&H offers many Nikon lenses from import, often cheaper. But not this lens, imported is same price.

Lowest price in Germany is 1873 or (excl. tax) $2090 which is a 13% discount over the US MSRP.
Package deals are a frequent way around pricing policy Falk, but my experience is Pricing policy's are more representative of what you can advertise at, what you can sell at is up to you. So when I sold packages before I sold it with a bundle price (Ie add everything up look at my margin and negotiate a price acceptable to close the deal. On the invoice though I would show a single price for all in a bundles. that way if they tried to return an item or 2 at another store in the chain they would lose the incentive given for the bundle
03-29-2012, 12:54 PM   #15
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So now all stores will do it like Amazon - have a high price listed, but actually sell it below that, once you click on the cart (or ask the cashier if he can give a discount)?
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