Download Century Furniture Minimum Retail Price Policy

Century Furniture Minimum Retail Price Policy
Century Furniture believes a significant factor in the company’s continuing success will
be the ability of its retailers to provide both excellent products and excellent service to
today’s consumer of better, upper-end furniture.
This requires that our products be sold at prices which are based on the value and
quality we have designed and built into them, and which also enable our retailers to
provide the superior level of customer service demanded by the consumer buying in the
upper-end market.
Accordingly, Century will periodically provide to its retailers a list of minimum retail
prices for certain collections of Century wood furniture and all Century Leisure furniture,
which includes all outdoor furniture. Century may change the MRP designation
periodically. The current requirements, as well as any updates to the Distribution Policy,
may be found on our dealer website at www.CenturyFurniture.com/DesignerStudio.
We intend to distribute Century wood products and Century Leisure only to retailers who
resell the products at prices no lower than our stated minimum retail prices. We will
refuse to sell to the offending retailer, for a period of one year, any wood collection(s) or
Century Leisure product involved in a policy violation. This Policy does not apply to
Century Upholstery, Century Leather, or Century Chair products.
Century does not desire or solicit and will not accept any agreement or assurance from
any retailer that the retailer will not sell below our stated minimum retail prices. Our
dealers may sell any Century or product at any price they think appropriate. Century’s
representatives and employees have been instructed not to discuss the Minimum Retail
Price Policy with any retailer or person outside of Century.
Century alone, independent of its retailers, will determine whether its products are being
sold in violation of our Minimum Retail Price Policy.
For the purpose of determining compliance with this Policy, the effective retail price will
be the retailer’s selling price, reduced by the value of any gift or promotional giveaway
or by the amount of any special discount given if partial payment is required. The
effective retail price must comply with the Minimum Retail Price Policy.
In calculating effective retail selling price, no reduction will result from a retailer’s use
of such standard merchandising tools as free delivery, payment of sales tax, extended
terms, or extended credit. Revised September 9, 2010
EXPECTED QUESTIONS
AND OUR RESPONSES
When will the policy become effective? The policy is currently in effect..
What products are included? All Century wood furniture including
Complements occasional and all Century Leisure furniture (“MRP Products”).
This policy does not include Century Upholstery, Century Leather, or Century
Chair.
Does this include floor samples for the MRP Products? Yes. Exceptions will
be made only for damaged or discontinued items, clearly marked for the
consumer as such.
What happens if Century’s prices change? Should the price on a MRP
Product change, our retailers will be promptly advised in writing of the new
minimum price and its effective date.
What constitutes a violation? Any advertised or posted offer, written invoice,
sales ticket, or price quote made below Century’s stated minimum retail price.
Will factory rebates be included in the calculation of the effective retail
selling price? No; but retailer rebates, retailer discount coupons, or gift
certificates to be redeemed for the purchase of a MRP Product, while not
prohibited, could conceivably result in a price that violates the policy.
What about promotional giveaways, free delivery, payment of the sales tax,
or extended credit terms? In determining compliance with this policy, the
effective retail price will be calculated by reducing the retailer’s selling price by
the value of any gifts or promotional items given or reduced in price as a part of
the purchase of MRP Product. That determination will be made solely by
Century. Certain merchandising tools will not be considered a price reduction;
among them are extended credit, extended payment terms, payment of sales tax,
and free delivery.
May I sell selected the MRP products at less than minimum price so long as
the total on the order reaches the total stated minimum prices for the
items? No. To sell or promote any individual MRP Product below its minimum
retail price will be a violation, even if the total price of the sale equals or exceeds
the total minimum retail price of all the items combined.
What will Century do if it discovers a violation? For a period of one year,
Century will not sell to that retailer any items from the collection or collections
involved.
Questions - page 2
Should I assure my Century sales representative of my compliance, or
report another retailer’s non-compliance? No. We believe the policy is clear.
Century’s management alone will determine if a retailer is violating this policy.
Century’s sales representatives are not to investigate or monitor retailer
compliance, nor to discuss these issues with their retailers. Please do not ask
them to do so.
What should I do if I have documented evidence of a policy violation?
Century does not encourage retailers to police one another concerning its
minimum retail price policy, but if you possess documents indicating a violation of
our policy, you may send them to Vice President - Sales, Century Furniture, P.O.
Box 608, Hickory, NC 28603; 828-328-1851. However, Century will not discuss
the alleged violation with you or report to you any action taken as a result of your
report. In planning and implementing its Minimum Retail Price Policy, Century
has acted unilaterally and will continue to do so.
What are the laws related to a policy of this kind? A supplier of goods may
lawfully announce a policy of refusing to deal with retailers who sell below a
stated price and may choose not to do business with those who do not comply as
long as the supplier’s actions are taken unilaterally.
Suppliers may not make agreements with retailers on the prices to be charged or
whether they will follow the policy. The supplier must simply announce and act
upon its policy.
In planning and implementing its Minimum Retail Price Policy, Century has acted
unilaterally and will continue to do so.
To protect Century and its retailers and to avoid any appearance of conspiring
with retailers to fix pricing, there shall be no discussion or negotiation between
Century and its authorized retailers concerning pricing or compliance with this
policy. There shall be no discussions about the pricing used by other retailers, or
about other retailers’ compliance or non-compliance with this policy. If a retailer
has documented evidence of a violation by another retailer, Century will accept it
without engaging in any discussion of whether it constitutes a violation or how
Century will respond.
Questions - page 3
How would offering a gift certificate to my customers create a policy
violation?
A gift certificate or a rebate certificate from retailer to consumer (factory rebates
excluded) effectively reduces the retail selling price, and if that price falls below
the minimum retail price stated by Century, the policy is violated. However, if the
retail price of an item is set at or above Century’s stated minimum retail price,
and a gift certificate is purchased by another consumer and given and used as
partial payment, the retailer is still in receipt of the full minimum retail selling price
and no violation has occurred.
Would a sale to my employee for his or her personal use violate the
minimum retail price policy if the price is below Century’s stated minimum
retail price? No. The policy applies only to sales to the retail consumer, not to an
accommodation sale to a retailer’s employee for personal use.
How does the Minimum Retail Price Policy apply to advertisements for
discon- tinued or damaged goods not sold at the retailer’s usual prices?
Century’s Minimum Retail Price Policy does not apply to its discontinued
products or to clearly damaged items, whether they are floor samples, inventory,
or sold orders. It is not a policy violation to advertise such goods at any price, so
long as the advertisement is completely clear that the prices or discounts
attached apply only to those items or suits that are damaged or discontinued by
Century.
How does the policy apply to sales at Century’s stated minimum prices
when a retailer wishes to pay sales tax on behalf of a consumer?
Century’s stated minimum retail prices do not include sales tax. It is assumed
that either the retailer or the consumer will pay any sales taxes due in
accordance with the laws of their state. If a sale is made at the minimum retail
price, sales tax is owed on that amount. If a retailer reduces the selling price by
an amount equal to the sales tax, and the result is an advertised/quoted price
before taxes that is below Century’s stated minimum retail price, the policy is
violated even if the retailer then collects sales tax on the reduced, belowminimum price.