Everyone who’s ever worked in retail knows how important the price is. This is not only for making profits, it is also to keep your customers coming, to have good relationships with your retailers, and to make your brand better, more noticeable, and more successful. Even though everyone is allowed to change the price of the goods they are selling, there are still some rules that retailers need to follow in order to be able to work with different manufacturers and suppliers. In this article, we are going to talk about the minimum advertised price, the MAP enforcement that’s needed to be done, and the MAP monitoring. We will give you more information on the whole process, and we will try to explain how does it work. Continue reading if you want to learn some of the basics of opening up your own business, or if you just want to know more about this process, and how everyone can benefit from it.
What is MAP?
When manufacturers or suppliers make a product, they need to ship it to the retailers so that the product can get sold. However, the retailers are the ones who choose the price they want to sell the product for, and in some cases, the manufacturer will get a percentage depending on the asking price, while in others, the retailer will give the manufacturer the amount they agreed on, no matter how much profit the retailers make.
To make sure that the manufacturer will not be in any losses, and that the brand will be able to make profits, there needs to be a limit of how low the price can go. This is also called a minimum advertised price or MAP, and it is a number that the retailer cannot sell the goods under. For example, if the minimum advertised price is 150 dollars, the retailer is allowed to put a price of 199 dollars, but they are not allowed to sell the goods for $149.
Sometimes these agreements are verbal and non-written, while in others, these agreements are legal and are made to protect the brand and the business. In case the retailer chooses to sell the goods for a price lower than the MAP, they will violate the policy, and they risk facing charges for it.
Why is MAP monitoring needed?
As you already know, the e-commerce business is extremely competitive. Nowadays, there are so many websites and online stores that sell the same goods, so it is difficult to get customers to notice you or to choose your business.
Because of this, many retailers want to offer the lowest possible price on the market, and by that, they can damage the manufacturers’ businesses. As you can see if you visit here, MAP enforcement is needed to protect your business, your brand, and to also make sure you are going to get your profits. When the retailers sell the goods for less money than the amount that was needed to create the goods, you will be losing money, and that means that your business is bound to collapse.
With the process of MAP enforcement, the manufacturers and suppliers can follow the price of their goods, and they can see if all the e-commerce stores are following the rules and are selling the items for the minimum amount or higher, or if they are violating the regulations.
It is said that this process is not only protecting the manufacturers, but also retailers, and it is beneficial for customers as well. It allows e-commerce sites from all around the world to sell the same goods, it brings new customers to the store, and it also gives the clients the possibility to purchase an item, no matter where it was manufactured.
How it’s done?
Now that you better understand the need for MAP enforcement, let’s give you more information on how it is done, and how does it work.
The easiest way that suppliers can track the price of their goods is by using modern software that will help them learn the price tag that their retailers have used, no matter where in the world they are located. In the past, these things were done manually, but as you already know, having a team that will do research all day long can be slow, can show incorrect results, and the human crew can miss something out.
To help with the whole process, the MAP monitoring software was introduced and it allows people who need it to track the price of their goods. Nowadays, there are a lot of different types of software, and even though most of them will get the job done, there are some programs that give you additional features that will help you get the needed results and violation alerts with ease.
You need to choose the right software for your brand so that you can focus on more important tasks, and you will know you will get alerts in case something is not done by standards. It is said that more than 20 percent of the product reports end up with minimum advertised price violations and that each year more than 2.5 billion dollars are lost in revenue because of these violations.
The retail market is really competitive, and sellers will do everything they can to get more customers, but that can never happen if it means that the process will damage or harm your business in any way. Know that more than two-thirds of the online sellers are not authorized to sell items to customers, and because of this, you need to follow the process of MAP enforcement. It will not only help your brand but will also help establish rules for illegal sellers and protect other businesses and clients on the market. The illegal and unauthorized retailers end up doing more damage than good, and by protecting your brand, you will be protecting your customers as well.
As you can see, minimum advertised price monitoring is beneficial for everyone, and the sooner you invest in software that will help you track your goods, the better it is going to be for your brand. Take your time to choose the right program for you, and know that you will sleep better when you know that your rules and regulations are not being violated.