fixed retail prices and domain names

[lucyhamilton]

I am a website designer and I recently set up a site selling cooling neckwraps. I had never seen these over in the UK before and someone I knew had one, and was over the moon with it. I tracked down the manufacturer in Australia and it seemed that there was no UK distributor.

I approached the manufacturer and found there was an office in the UK, but the domain name of the product was still available and as it is a generic term for an Australian friend I bought it. (The company use their own company name for the domain.) The distributor said I could order the neckwraps and use any images and text off their original site in order to help sell the product.

I ordered the stock, made the site live offering a bit of a discount on the RRP (which I had also been informed was OK) as I had seen 3 other sites in the UK discounting the product. That very evening I had a call from the Managing Director in Canada saying I was not allowed to discount the product as they didn't want it to appear cheap and tacky and they also didn't want to annoy their high street retailers. It seems to me that they are making a fixed retail price.

The company could simply stop supplying me, and I would have to source another product, but my question is (at last!) would the company have any right to the domain name? I presume not as it is generic, and also reading the thread about google and booble I see that the company should have been actively defending the name in the first place. Surely it would have been sensible of them to buy it in the first place?! Only now are they drawing up some terms and conditions on selling the product, before this everything was verbal.

Lots of points here, but basically where do I stand? The site I have made looks as good as, if not nicer than their site, so I am not bringing the product into disrepute. I feel I have been treated very unfairly as I am trying to sell their product, not a rival one and surely they cannot police every sale? I guess they are worried that as I have the domain name people will assume mine is the definitive site.

Anyway I am now offering the product at full retail price, but with no postage... They say they are still disappointed so I am waiting to hear why!

[Linda Buquet]

Hi Lucy,

Well I'm a little bit confused since I don't know what the names are. But it seems to me if "The company uses their own company name for the domain" and you registered a different name there should be no problem with the domain. Sounds like you may have a problem with the relationship, however. They sound a little short sided to me.

Just for a little clarification, the domain you registered is of the product name, but is generic enough you should be okay. You are discounting the product, which you were told you could do, then they told you not to, and now you are curious as to whether or not they can take the domain name.

First off, they may be able to take the domain, though it will be a battle to do so, unless there was a written contract or agreement forbidding you to do so. Some companies will spell out terms for resellers/distributors on this subject, check to see if they have something like this in a reseller spot on their web site or something.

Second, if you are offering discount and were told you could, who told you that it was okay to do so? The distributor (whom I assume is a wholesaler or other separate entity than the manufacturer)? If so they may not have that authorization. If the manufacturer told you that it was okay, then there is a mis communication there that should be cleared up. Bring up the fact that others are doing the same, and if you cannot, you want to know the justification in that.

Also, who gave the permission for the content (images etc), the distributor or the manufactuer?

Being a computer systems builder along with a web developer, many distributors will allow you to use their images/copy/etc but if you are not in accordance with the manufacturer's requirements (which many times doing it this way problems arise) they can have you fix it to thier liking to comply with product presentation, copyrights and other requirements. The other option is to remove you as an authorized reseller of that product.

Sometimes too, jealousy plays into the picture. If you site is nicer and smoother than the manufactuers (which happens quite often) than they may be jealous and not like that they look worse than you do, and then that is the cause of being afraid that people will think you are the company and not them. I have seen this happen as well, and if this is the case, maybe you could approach them to offer a site design to them to help thier image match or maybe slightly beat yours without lowering your quality.

As far as making a fixed retail price, it happens more than one would like to think it does. There are laws against different things in this area far beyond myself. You may very well contact the other UK online retailers and find out if they have been contacted much as you have. Sometimes your competition can be your best ally against a manufactuer or distributor trying to do things that are questionable.

One thing too to keep in mind, is the Internet still has the appeal of quick to market, quick to start a business and quick to make a profit to many. What happens is the "verbal" agreements generally are good for a bit to get started, but always, always always get written confirmation of everything everytime.

Also, check the credentials, are you 100% that this person who called in the managing director in Canada? Why is he calling, and not the Austrailian manufacturer who controls the product as a whole? If he refuses to provide written confirmation of who he is, then maybe he isn't who he claims to be. (A competitor maybe trying to fool you to get you to close shop?)

Anyways, let us know how it works out!

[lucyhamilton]

Thank you so much for such a long and detailed reply. My post was perhaps a little confusing especially as I didn't write the actual domain name, but I feel that as I am in such a sensitive position I didn't want to make it too personal!

It was actually the staff member at the London office (who apparently sees the head guy in Canada twice a year) who told me I could discount the product and use the images and text off the website. When I told the man in Canada this he said she had made a mistake, which I said was rather an unfortunate and downright stupid mistake especially as he has been running the business for 14 years! Communication obviously isn't his strong point. And obviously he hadn't put much thought into his internet marketing strategies.

He definitely is the head distributor cos I initially contacted the Australian manufacturer and they put me onto him, and he in turn put me onto the person in London.

I still haven't heard anything, but it has left a rather sour taste in my mouth! Perhaps I should just stick to web design in the future....

Thanks again

Lucy Hamilton
www.poleposition.uk.com

[southplatte]

And obviously he hadn't put much thought into his internet marketing strategies.


Many businesses make this fatal mistake, they throw up a web site, have no strategies for it, no direction, no goals and wonder why it doesn't do that well, and why resellers have better luck than they do.

I have seen many web sites of resellers that look better and function better than the manufactuers web site, and it is always the manufactuer that throws the fit about it.

Best of luck with it!