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Topic: Amazon.fr stops selling Switch ! o_O

Posts 21 to 24 of 24

Haruki_NLI

@BlueOcean They evidently do accept this. The issue as posed is firstly conjecture on the part of the article, and secondly, yes what you state is true, however the RRP is more complex than "Shops can decide the price".

They can choose to sell at whatever price they desire, but the manufacturer cannot undercut, nor can the retailer go above a stated price (Though this is non-binding, however stock can obviously be withdrawn).

A supplier can, however, issue non-binding RRPs for its products or impose maximum prices above which its retailers or distributors may not resell the products, provided that the RRP or the maximum price does not amount to a fixed or minimum resale price as a result of pressure or incentives.

If both the supplier’s and the buyer’s market shares do not exceed 30%, these restrictions will be automatically exempted under the EU Vertical Agreements Block Exemption (VABE). However, in each case, the RRPs or maximum retail prices must not be disguised minimum resale prices or fixed resale prices. In particular, retailers must be allowed to resell products at prices below the RRPs or maximum resale prices.

Furthermore, this is not the first instance of Amazon dropping a platform holder. Amazon UK and US, sporadically, stopped stocking PlayStation things several times earlier this year.

The one consistent here is Amazon, regardless of where it is globally, and it tells me that Amazon dropping the price for a specific reason.

Given, as you mentioned, retailers in the EU can set their own price, and Amazon is undercutting the set retail price, what is to stop other retailers taking notice and competing with Amazon in what would likely become a downward spiral in a price war?

Retailer A sees Amazon undercutting them, they can sell the stock for whatever price they want, they undercut Amazon via the same methods, dropping the price and selling cheaper. Retailer B sees this, fears losing business, the cycle continues, downwards it goes, devaluing the Switch and it's games in the market.

This, as a manufacturer, is not what you want. If the selling price to consumers drops too far, then for retailers to make any profit at all, they'll need to buy the produce from Nintendo at a cheaper price, meaning Nintendo will then make less money per unit in wholesale to these retailers, who need to buy cheaper to continue profiting from their self-imposed price war.

So sure, they do need to "Accept it", but there is no law saying they can't STOP supplying, especially when in a free market price wars can be common. It ultimately hurts everyone in the end.

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HobbitGamer

Knuckle dropping that spot on hot knowledge like a brisket. Mmm brisket. It goes so nice with business analytics.

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Banjo-

@Knuckles-Fajita I think that Nintendo don't want other retailers to complain and they just stopped supplying Amazon because of that. I've neve seen any "crazy" sale for Switch on Amazon anyway. Amazon doesn't lose money in the end because otherwise they wouldn't sell at that price.

The only thing I am not sure is if Nintendo can freely choose what retailers can sell their products, I think so because you are saying it and also because there are "official" distributors for major brands that are simple shops, but isn't it against the free competence law to supply Switch consoles to just one or two retailers in Europe, if Nintendo did that?

Banjo-

Haruki_NLI

@BlueOcean Not really.

The company I work for doesn't sell Switch stuff, or gaming in general, but does sell official merch, not because Nintendo doesn't want us selling it, but because we simply lack the capacity to do so in our stores. Now does that make it illegal that Nintendo doesn't sell Switch units to us, excluding us from selling that product? No. That was the choice of the retailer.

I can walk into many stores of other retailers selling PSN or XBLA cards but not eShop cards. Does that mean Nintendo isn't supplying, or does it mean the retailer isn't buying? Will we ever know?

As I said, this is all conjecture.

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