ECON 308 Chapter Notes -Resale Price Maintenance, Brighton Collectibles, Price Fixing
19 Apr 2013
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Some economic analysts conclude that vertical price restraints can have procompetitive effects. In 1991, leegin began selling belts under the brand name brighton. It has now expanded into a variety of women"s fashion accessories. Leegin asserts that small retailers treat customers better, provide more services, and make their shopping experience better than larger retailers. Kay"s closet at one time sold the brighton brand, beginning in 1995. Once it began selling, the store promoted the brighton brand. Brighton was the store"s most important brand and once accounted for 40-50 percent of its profits. In 1997, leegin instituted the brighton retail pricing and promotion policy , in which they refused to sell to retailers that discounted the brighton goods below suggested prices. The policy had an exception for products not selling well that the retailer didn"t plan on reordering. It also expressed concern that discounting harmed brighton"s brand image and reputation. In december 2002, leegin discovered kay"s closet had been marking down.
