Shinn Fu Company of America, Inc.
Minimum Advertised Price for Private Label Products – U.S.A.
Introduction:
As a leading innovator of automotive accessories, SFA is proud of its role in pioneering new products, designs, and innovative production methods that reduce costs and improve the quality of products in our industry.
SFA is proud to offer many of its high quality and innovative products as Private Label products (“PL”). Of course, one advantage of PL is that you, as the customer, are able to support your own brand and develop customer loyalty. At the same time, because many of SFA’s products are distinctive or provide innovative features, sophisticated “thought leaders” in our industry will – if they have reason to do so – discover that SFA is associated with the PL and will equate the PL version of the product with the non PL products distributed by SFA. Therefore, SFA has an interest in assuring that the perceived level of quality of SFA products, even when they are private labeled, is maintained.
As a result, SFA has unilaterally adopted a MINIMUM ADVERTISED PRICE POLICY (“MAP Policy”). This MAP Policy is aimed at assuring that the perceived value of SFA products remains high which also supports the perception of SFA’s brands, reputation and competitiveness.
Therefore, in its unilateral discretion, SFA will not do business with any reseller or distributor, as to the products covered by this MAP Policy, if that reseller intentionally advertises any MAP Product below its MAP price or sells product covered by the MAP Policy to downstream resellers who have not agreed to follow the MAP Policy. As further noted below,
MAP Policy Guidelines and Requirements:
These policies apply to all U.S. and Canadian customers who resell the SFA products listed in Exhibit 1. The MAP policy applies only to advertised prices and does not apply to the price at which the products are actually sold or offered for sale to an individual consumer within the dealer’s location, over the telephone or through a “bid” process. “Downstream Reseller” means one of your customers who resell the SFA Products covered by this MAP Policy. This MAP Policy does not prohibit SFA’s customers or their Downstream Resellers from selling covered SFA products at any price they choose. It simply means that advertised price must conform to this MAP Policy. SFA is confident that this program will strengthen its competitiveness and benefit all of its distributors and resellers..
- As a direct purchaser of SFA product, you are responsible for assuring that any Downstream Resellers adhere to this MAP Policy. You must provide a copy of this policy to Downstream Resellers who are reselling SFA products covered by the MAP Policy. You may be held responsible for any violations of this MAP Policy committed by your Downstream Resellers.
- SFA reserves the right, in its unilateral discretion, to take action with respect to any reseller that violates this MAP Policy. The MAP Policy will be enforced by SFA in its sole discretion.
- Although SFA’s customers and Downstream Retailers remain free to establish their own resale prices, SFA reserves the right to cancel all orders and indefinitely refuse to accept any new orders from any resellers following SFA’s verification that such reseller has advertised any MAP Products at a net retail sales price less that the then-current MAP retail price established by SFA, or if reseller has violated this policy in any other way.
- SFA recognizes that any authorized SFA account can make its own decisions to advertise and sell any SFA product at any price it chooses without consulting or advising SFA.
- SFA will maintain an updated “MAP Products” list of those products that will fall under this MAP Policy. SFA reserves the right to update or modify this list at any time.
- All Products listed in Exhibit 1 will have a MAP retail price. Listing a price other than the MAP retail price next to the featured MAP Product in any advertising will be viewed as a violation of this MAP Policy. This MAP Policy applies to all advertisement of MAP Products in any and all media, including, without limitation, flyers, posters, coupons, mailers, inserts, newspapers, magazines catalogs, mail order catalogs, internet or similar electronic media including websites, forums, email newsletters, email solicitations, television, radio, and public signage. Such website features as “Click for price”, automated “bounce – back” pricing e-mails, pre-formatted e-mail responses, forms, automatic price display for any items prior to being placed in a customer’s shopping cart, and other similar features are considered to be communications initiated by the reseller (rather than by the customer) and this constitutes “advertising” under this MAP Policy. It is not a violation of this MAP Policy to provide the customer with a price below MAP once an item is placed in a customer's "virtual shopping cart" on an internet website. Pricing that is associated with the end customer's intent to purchase is deemed the "selling price" and is compliant with the MAP Policy. SFA’s customers and their Downstream Resellers remain free to sell products at any price they choose.This MAP Policy also applies to any activity which SFA determines, in its sole discretion, is designed or intended to circumvent the intent of this MAP Policy, such as solicitations for ‘group purchases’ and the like.
- It shall NOT be a violation of this MAP Policy to advertise in general that the reseller has “the lowest prices” or will match or beat its competitors’ prices, or to use similar phrases; so long as the reseller does not include any advertised price below MAP and otherwise complies with this MAP Policy.
- From time to time, SFA may permit resellers to advertise MAP Products at prices lower than the MAP retail price. In such events, SFA reserves the right to modify or suspend the MAP retail price with respect to the affected products for a specified period of time by providing advance notice to all of its customers of such changes.
- From time to time SFA may offer a direct manufacturer’s rebate to customers. In such event, it shall not be a violation of this MAP Policy to advertise the availability of the manufacturer’s rebate, provided that (a) the advertisement include a MAP-compliant price, the rebate amount, and the net price after manufacturer’s rebate in the same type size and style; (b) an asterisk is placed next to the net price after manufacturer’s rebate; and (c) the “*After manufacturer’s rebate” appears in the same area of the advertisement as the advertised product.
- Where SFA products are bundled with or sold as part of a package that includes other products, it shall be a violation of this MAP Policy to sell or advertise the bundle (or package) at a price that in the exercise of SFA’s reasonable discretion would be lower than the MAP Policy price for the SFA Product covered by the MAP Policy when a fair allocation of the costs of the (non-MAP) elements of the bundled elements are considered.
- It shall be a violation of this MAP Policy to include in any advertising for SFA Products any additional discount, coupon, gift card, or incentive (whether in the form of a special event, promotion, term of doing business or otherwise) that translates into an immediate price reduction, where the cumulative effect would be to reduce the advertised price of any MAP Product below MAP. Advertising that includes an additional discount, coupon, gift card, points, or any other incentive for future purchases (regardless of whether the future purchases is of a SFA product) shall be evaluated under the same guidelines as described in Section 9 regarding product bundling. For example, a gift card redeemable on a future purchase would be considered an “other product” under Section 9. This Section 10 shall not apply to any manufacturer’s rebate from SFA on SFA Products or its partners’ products.
- It shall not be a violation of this MAP Policy to advertise that a customer may ”call for price” or “email for price”, or to use similar language, specifically with respect to SFA Products, so long as no price is listed.
- If a reseller with multiple store locations violates this MAP Policy at any particular store location, then SFA will consider this to be a violation by all of the reseller’s locations.
- SFA’s sales representatives are NOT permitted to discuss this Policy or make any agreements or assurances with respect to SFA’s Policy regarding reseller advertising or pricing. This also includes any consumer program or promotion that affects the below-listed MAP Products.