Was told that Victorinox suspended domestic distribution

[Sep]

A sak is no more a multi-tool then diesel is gas.

Not once have I said this is illegal, nor do I give a rats a$$ about American law.
I am laughing like he!! at some of these posts, I say price fixing and you guys come out of the woodwork. Yet some of you use the phrase "to control prices".
Play your word games, I think it was clear on how my statements were meant to be taken.
Please go ahead and highjack this thread into an economics word definitions discussion rather then what it was about. Victorinox cutting out distributors in favour of dealers that will artificially inflate the prices that consumers will pay.
Go ahead pay your higher prices, defend this practice in the end I will make my choice and you will make yours

We're not talking about the edge holding properties of SAK knives here, we're discussing their selling practice. As such, it's a matter of Economics and Law. I talk about advanced topics in Economics and Law, and you brush it off as simply "word games".

If you don't want your opinion challenged in a public forum, then don't post in a public forum. Simple.

 

[Eyegor]

I have followed this thread with interest but up until now have refrained from posting due to my limited knowledge. But I see a point that many may be missing. However, if I am incorrect then someone can correct me.

As a consumer I am familiar with several other products that have MAP assigned to them. MAP is Minimum Advertised Pricing. Meaning that a retailer cannot advertise a price lower than MAP for a given product. In almost every instance of this once a vendor / seller relationship is established the merchant either can or does pick what price he wants to sell the product for. As an example, if I own a B&M store and personally love the Vic Hercules (random example) I might order several dozen for my store. When these do not sell, what am I too do. Can I return them to Vic for credit? Not likely. Do I simply chalk it up to bad business decisions and let the inventory sit? I hope not. What I would do is offer any customers who seemed interested a special incentive price on remaining Hercules models. I can't advertise this price, but I can sell at this price.

Again, this is the way MAP was explained to me by sales reps in other fields. Not 100% sure if it applies here. I guess we will have to wait and see how this effects sales. On a personal note; I don't collect knives per se. I use different types of knives in many activities so I end up with a sizeable assortment. This means all my knives are users, pure and simple. Yes, some I value more than others but not do to construction, material, etc. That being said, SAKs have always been an exceptional value and even if the worst happened and prices raised somewhat, I suspect the cost/value ratio would still favor the consumer. So let's all take a breath, wait, and see.

 

[Sep]

AFAIK it means you can't advertise the product below a certain price, but when customers come to your store or call you're free to sell it at whatever price you want. Yes, manufacturers are keeping the price artificially high, but remember, their competitors are still free to sell their products for less MAP. It's no longer a competition between online and B&M stores, it's straight competition between manufacturers.

Savvy shoppers and collectors can still get deals. Amazon adheres to MAP, but their site is so advanced that you can find out the bottom price just by adding the product to the shopping cart. Most other online retailers do not run such an advanced system, so they resort to phone calls and coupons. As MAP becomes more common, more e-commerce systems would be set up to handle it just like Amazon.

 

[Doug S]

Don't know anything about the topic, but I was surprised that the prices on SAKs have gone up signficantly on Amazon from just last year. Knives that I was buying for $25 are now closer to $50 (Explorer Plus).

 

[marcangel]

Call it what you will, but it is price fixing. Price fixing is "inherently un-American", simply because the U.S. was founded on the principle of a free-market economy. Now it's fine for people from outside the U.S. to criticize our laws, our culture, etc. because we have protected rights which are fairly explicit and outlined in a document called "The Constitution". It's funny how people from outside the U.S. become such vocal critics when these "issues" are discussed. Glad to see all the Swiss, French, Italian, German and other EU soldiers out there in Afghanistan and Iraq trying to quell global terrorism.

It is somewhat interesting to note the corporations who regularly engage in price fixing:

Rolex, Apple, DeBeers, to some extent Mercedes-Benz and the list of high ticket desirable items goes on and on.

The big difference between these companies and Victorinox is they don't produce 34,000 items per day!

Although I'm a big Vic fan, I have to say I believe this policy will backfire on them, particularly given the situation of the global economy. I also find it interesting how Victorinox basically got down and begged before the U.S. courts to protect their trademarked "genuine and original swiss army knife" terminology to stave off competition from cheap imitators. After of course they bought out the failing Wenger brand. And now they engage in price fixing, how quaint.

Let's all remember, Freedom isn't Free, and a free market economy is anything but free. Visciously competative, yes. Free, no friggin' way!

Roger, just some friendly advice, since I'm one of your very large customers. It is probably best to stay out of these discussions entirely. It is certainly a really bad plan to insult a well respected Victorinox dealer who is a "friend" of this community. Mixing it up in this discussion will result in only one thing...

a bad outcome for YOUR BUSINESS!

Now I'm prepared for the unmerciful flaming that will undoubtably occur after this post get's read. But that's OK, because in a free-market economy...

THE CUSTOMER IS ALWAYS RIGHT!

AND I'M THE FRIGGIN' CUSTOMER!

 

[Sep]

The supreme court just decided that MAP is not automatically illegal. They are the ultimate arbiter of what's constitutional and what's not. It's not automatically illegal because in many cases it actually encourages competition BETWEEN brands. That Leatherman or SOG suddenly looks rather cheap when Victorinox starts doing MAP.

And please, MAP is not exclusive to non-American companies. In other industries American companies have done it in droves. As far as knives go, Benchmade is a big name. Benchmade even went as far as selling to brick & mortar stores only. Buying Spydercos and Kershaws is much less of a hassle, and I'm sure it has helped them some.

The market is the ultimate democracy. If you don't like Victorinox's MAP, then you are actually better served by not buying their product. If enough people think that MAP sucks and Vic sees their sales suffer, they will abandon it. Regardless to the "we stand by our retailers" rhetoric, the bottom line is they're in business to make money, not lose it. MAP is calculated to net them more sales because every mom & pop store and gas station can now sell SAKs without losing out to WalMart or online retailers. That is a massive exposure. As a knife enthusiast I actually like the idea of regular (non Internet savvy) people getting more exposure to knives.

 

[hardheart]

Savvy shoppers and collectors can still get deals. Amazon adheres to MAP, but their site is so advanced that you can find out the bottom price just by adding the product to the shopping cart. Most other online retailers do not run such an advanced system, so they resort to phone calls and coupons. As MAP becomes more common, more e-commerce systems would be set up to handle it just like Amazon.

for online buying. couldnt websites just advertise the price in cart only as a way get around the advertised price rule

Some try to do that but the MAP policy specifically prohibits that as well as "call for price", etc.

.....

 

[Sep]

If price discovery through shopping cart and call-in are prohibited by some MAP contracts, then I guess they really want to avoid online sale. Just like Benchmade who flat out refuses to sell to online-only stores, they have made a conscious decision to force people to visit brick & mortar stores.

I'm a savvy internet shopper, and since MAP manufacturers specifically favor the average guy who is uneducated about knives through B&M stores, then I tend to take my business to other manufacturers who value my patronage.

 

[marcangel]

I'm still waiting for the flames,....maybe I won't get them this time. Interestingly, today I ordered 3 damascus Victorinox knives at about $125 each. They should be here by Thursday, since the dealer is less than 100 miles from my home. Now, I've been patiently waiting for the same item (paid for and accepted on a pre-order basis) for the "better" Swiss version. Actually, I paid quite a bit more, 3 months ago for the "better Swiss version". They have yet to arrive at my door. The dealer has had my money for quite some time and I e-mailed him twice only to get a response (after a week) that the mail is slow. I sincerely hope that both versions of the knives arrive soon so I can evaluate them side by side. I'd truely like to see if the "better Swiss version" justifies its cost and wait.

 

[ufox9al]

I'm still waiting for the flames,....maybe I won't get them this time. Interestingly, today I ordered 3 damascus Victorinox knives at about $125 each. They should be here by Thursday, since the dealer is less than 100 miles from my home. Now, I've been patiently waiting for the same item (paid for and accepted on a pre-order basis) for the "better" Swiss version. Actually, I paid quite a bit more, 3 months ago for the "better Swiss version". They have yet to arrive at my door. The dealer has had my money for quite some time and I e-mailed him twice only to get a response (after a week) that the mail is slow. I sincerely hope that both versions of the knives arrive soon so I can evaluate them side by side. I'd truely like to see if the "better Swiss version" justifies its cost and wait.

You've been very lucky to get 3 out of 48 Damascus Pioneers that were allocated to the US, and at about 30% off MSRP to boot! Congratulations! If you could share from where you got them, it would be appreciated.
Since all the 2010 pieces of Damascus Pioneer are identical, there can possibly be no difference between the ones you get in the US and Switzerland. The 30 pieces that Canada got were sold out before they arrived.

 

[jfive]

@swissbianco

To be honest: I don't get your point. But what I do get is the impression once again that you are just looking for a justification to sell your stuff way, waaay overpriced. And this isn't just my opinion but that's something I don't want to discuss with you in public.
Whatever...of course the employees in Ibach want to make some money - so does everybody else including the dealers in the US so why shoudl they do "charity"??? And I don't think Victorinox just give knives away for free. Vic most likely offers the stuff they produce for reasonable prices.
Last year I bought a SAK in Cali and I think the price was comparable to what I would had to pay back home in Germany.
And in Germany you get SAKs for very little money too. So what's the big deal about inexpensive SAKs?! I think this is why so many people own at least one of em.

 

[ufox9al]

I re-read this thread and, in summary, arguments looks something like this:

Pro-MAP: Introduction of MAP will level the playing field for B&M stores to be able to continue carrying Vic. products

Anti-MAP: This is price fixing, it's anti-American.

Pro-MAP: MAP will encourage dealers to compete on service rather than price. It will also, hopefully, allow a respected dealer who runs a charity organization to raise enough money through SAK sales without having to sell off his personal collection. It amay also allow him to return to selling on eBay.

Anti-MAP: This is price fixing, it's anti-American.

Pro-MAP: MAP will eliminate sales of SAKs on eBay and drop-ship online stores by the university students and "hobby dealers", who have engaged in a cut-throat discounting, often making a profit of $1/sale.

Anti-MAP. This is price fixing, it's anti-American. Oh, and I won't be able to buy SAKs for $1 over the wholesale price.

... and this last sentence is pretty much what this is all about, no? This is about having to pay $25 for a Tinker instead of $15, or $35 for a Farmer instead or $20. Paying $10-$20 extra for a knife that carries lifetime warranty, and those extra $10-$20 going to a Victorinox dealer to cover their costs. So, please, stop throwing in slogans and either continue buying SAKs or stop (and declare ir as a boycot of Victorinox) - the ones you already have will last you a lifetime.

With respect to Swissbianco pricing, it's really very simple - it's generally MSRP. For the +B special runs, please compare +B newsletter prices to "free market champion" - eBay. You will see that those pieces consistently fetch more on eBay (most recently, Black Farmer: newsletter $55, eBay: $79-$92). For stock Victorinox offerings, you are free to buy those from the other dealers, if you can get them cheaper. For the hand-assembled pieces, like the OHT and Dual Pro with wood and/or metal saw, the cost of custom manual assembly gets figured in, and necessarily drives the price up. You can still get a "fully loaded" custom assembled Dual Pro (with wood saw and metal saw, you choice of Corkscrew or Phillips, and your choice of scales) for $95.

 

[Mahoney]

I'm no fan of price fixing, but it will be interesting to see what comes of this. I suspect that I. like most people, will vote with my wallet. If I feel a particular SAK is worth the money at the MAP I'll buy it, if not I won't. By selling fewer knives, but at a greater profit each, Victorinox won't necessarily lose money. The argument for Brick and Mortar stores is a bit silly. There hardly any left. In the greater Los Angeles area there are only about 4-6 stores left that carry any significant number of knives and have salespeople with any knife knowledge. Buying an SAK off a peg at Target might as well be an online sale.

Victorinox has a bit of a monopoly in this particular market niche with the acquisition of Wenger. The Chinese SAK copies are mostly crap. If the MAP policy is effective it will open a market niche for a manufacturer that can produce decent quality knives at a lower price. It will be interesting to see if anyone tries that.

 

[marcangel]

Please refer to recent GBU thread. It's war baby! Bring it and we won't buy it. Econ 101. Despite the sad state of the economy the US is still the largest buyer on the planet and even though I love and respect the product my wallet is now CLOSED to new SAK purchases. Can't wait to see the "difference" about what arrives.

 

[supratentorial]

I have no knowledge whatsoever what Tim and FVEAP do or don't do. I just know that FVEAP is Vic./Wenger Authorized Daealer, and that I buy the majority of my SAKs from him.

My first question was actually directed to Felinevet but you replied instead.

...Secondly, Victorinox has discontinued all distribution through wholesale outlets and now sells ONLY through Authorized Dealers... Only means that knives must be purchased through Authorized Dealers. The intent is to strengthen the dealer network...

"I think Tim is financially overexteded with all those order he placed with Amazon! It's a good news for all the folks on the other side of the pond, since Amazon does not ship overseas..."--ufox9al

I doubt Victorinox wants their authorized dealers to buy from other dealers instead of placing orders through them. Also, buyers expect that merchandised purchased from authorized dealers will be from the manufacturer, not purchased from another store, repackaged and resold ...although another dealer buying from Amazon does show the high level of consumer confidence in Amazon.

...MAP will eliminate sales of SAKs on eBay and drop-ship online stores by the university students and "hobby dealers", who have engaged in a cut-throat discounting, often making a profit of $1/sale.

Those darn college kids - trying to put themselves through school!

My impression is that those who stand to profit from the new policy seem to down play the price increase while consumers who face higher prices will likely be unhappy by the new policy.

 

[illumination]

I guess this means fewer SAKs for me.

Like many of you, I am a rational "economic animal". Lower prices, I buy more. Higher prices, I buy less.

Interesting that they chose to favor their B&M dealers over themselves. What they collect isn't dependent on what their dealers charge. So with lower volume (people reacting to price increases), their revenues will decline. Interesting that they choose to do this during an economic downturn. I don't expect this to be good for their bottom line. But then again buying their only real competitor had to be somewhat helpful in maintaining prices and profitability.

And even if it is not price "fixing", it is clearly anti-competitive.

 

[Sep]

I guess this means fewer SAKs for me.

Like many of you, I am a rational "economic animal". Lower prices, I buy more. Higher prices, I buy less.

Interesting that they chose to favor their B&M dealers over themselves. What they collect isn't dependent on what their dealers charge. So with lower volume (people reacting to price increases), their revenues will decline. Interesting that they choose to do this during an economic downturn. I don't expect this to be good for their bottom line. But then again buying their only real competitor had to be somewhat helpful in maintaining prices and profitability.

And even if it is not price "fixing", it is clearly anti-competitive.

You are assuming that everybody buys SAK from the internet, which is simply not true. We (internet-savvy knife enthusiasts) are the minority. Most people aren't into knives, so they buy whatever is available from the local store when the need arises. If B&M stores are reasonably certain that they won't be undersold by Internet retailers, they'll carry more SAK products. This move actually increases the general public's exposure to SAKs, which in theory should translate into more sales.

They sacrifice smaller internet sales for larger B&M sales. It makes perfect business sense to me.

No, this is not "clearly anti competitive". It's not friendly to consumers, but it actually spurs competition between manufacturers. Those Leatherman and SOG tools suddenly seem to offer better value for money because they can be found for less, compared to Swisstool's near-MSRP price.

 

[shecky]

The price fixing charge seems pretty silly to me. Victorinox is stabilizing consumer prices for their wares. It would be no different from implementing a "no haggle" policy. Furthermore, by raising their own prices, any harm done is self inflicted.

This isn't to say I'm happy about higher prices. But I'm not happy when anybody does it. As long as I want what they offer, I have to accept the deal.

If Victorinox controlled some commodity, perhaps if Victorinox was the only manufacturer in the world, consumers might have a legitimate beef with their policy. But they don't. And they will suffer (or succeed) solely at their own doing.

 

[stevomiller]

Huh, doesn't make me happy. There aren't any brick and mortar stores that sell the alox models within 25 miles of me: furthermore, I don't think that there ever will be regardless of Victorinox's new MAP policy.

No local dealer will benefit from this, but I will suffer from it.

 

[illumination]

No, this is not "clearly anti competitive". It's not friendly to consumers, but it actually spurs competition between manufacturers. Those Leatherman and SOG tools suddenly seem to offer better value for money because they can be found for less, compared to Swisstool's near-MSRP price.

uh. no. this is a basic microeconomic concept. the fact that it is unfriendly to consumers means it is anti-competitive. to be clear, it is not illegal (i.e., price fixing) as some have suggested

http://en.wikipedia.org/wiki/Suggested_retail_price


and don't kid yourself - Victorinox raising prices isn't going to cause their competitors (o'h wait they bought their only direct competitor) and near competitors (Leatherman, etc.) to lower prices... sure people may decide to buy something else but that doesn't mean it is pro-competition