Stihl LOST the Policy Embargo

[shadco]

Snippet from the FTC site.

Seems to reinforce Stihl's policy.

Until recently, courts treated minimum resale price policies differently from those setting maximum resale prices. But in 2007, the Supreme Court determined that all manufacturer-imposed vertical price programs should be evaluated using a rule of reason approach. According to the Court, "Absent vertical price restraints, the retail services that enhance interbrand competition might be underprovided. This is because discounting retailers can free ride on retailers who furnish services and then capture some of the increased demand those services generate." Note that this change is in federal standards; some state antitrust laws and international authorities view minimum price rules as illegal, per se.

If a manufacturer, on its own, adopts a policy regarding a desired level of prices, the law allows the manufacturer to deal only with retailers who agree to that policy. A manufacturer also may stop dealing with a retailer that does not follow its resale price policy. That is, a manufacturer can implement a dealer policy on a "take it or leave it" basis.

Limitations on how or where a dealer may sell a product (that is, customer or territory restrictions) are generally legal — if they are imposed by a manufacturer acting on its own. These agreements may result in better sales efforts and service in the dealer's assigned area, and, as a result, more competition with other brands.

More here ==> https://www.ftc.gov/tips-advice/com...ws/dealings-supply-chain/manufacturer-imposed

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[Cobby08]

I didn't take anything you said as an assault on me. Your comments are on point. Some businesses are already screwed. Malls are closing, long standing department stores are closing, mom and pop stores are almost non-existent anymore, etc.

Unfortunately, like it or not, selling online is the way of the future. Actually, it is already here. Companies and businesses will have to make adjustments and get on board or risk losing business/profit, or worse.

Oh yes, we are screwed.

 

[Al Smith]

I have a very good relationship with the Stihl dealer I do business with who is 15 miles away .The one two miles away I won't do business with .On the rare occasion I need Husqvarna parts I buy from a guy in North Carolina because there are no stocking dealers in these parts .I could and have got a few small parts through the mail for Stihl . The rest of the many old saws I'm reliant on the internet for parts .Which BTW I've always found but it can be a chore . Restoration of any thing is not for the impatient .

 

[Shanesaw80]

The shop I deal with is 2.5hrs away from me and I rarely ever go there. I call them with a list of what I need and they overnight ship it to me. So far they’ve shipped 5 saws to the US for me. I call them and tell them what I want and give them the address, they take it to the post office and mail it for me. Never once have they said “no I’m not allowed to do that”.

 

[CLEARCUT]

The shop I deal with is 2.5hrs away from me and I rarely ever go there. I call them with a list of what I need and they overnight ship it to me. So far they’ve shipped 5 saws to the US for me. I call them and tell them what I want and give them the address, they take it to the post office and mail it for me. Never once have they said “no I’m not allowed to do that”.

Sounds like an awesome dealer.
A lot of dealers around here are a little embarrassing. I go in there and the “technician” can’t get me a cylinder cover for my 661 because I don’t have the serial number. But there are a couple good dealers here. However, I get most of my parts and supplies from Madsens.

 

[00wyk]

Case law settled in another country has no bearing on US law or enforcement of said US law. What the court ruled in this case is that the policy that Stihl had in place in the country of the court's jurisdiction, i.e. France, violates the laws of that country.

The French court found Stihl in violation of not only at least one of their federal regulations, but also of EU regulations:
(https://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:12008E101:EN:HTML).
Basically: Article 101(1) TFEU1 bans agreements and concerted practices* between companies and groups of companies that may affect trade between EU countries and whose purpose is to prevent, restrict or distort competition within the EU's single market.

In other words - a monopoly or monopoly type trust is not legal. Which, oddly, is also the law in the states...but we'll talk more about that later.

The ruling will likely be upheld throughout the EU, which is the largest economic block in the world currently, unless Stihl feels like fighting it in other Euro courts and chancing more fines and reprimands, or flat out being thrown out and penalized by pushing it. So it will be interesting to see how this goes. Prices locally haven't moved any yet, but we are a tiny market for Stihl. I mean, it is like being back in time to live in Ireland. One of the many reasons I live here, tho. But I do notice prices are better on the continent...
Having said this, there is still time for them to fight it in the EU.

It's up to the US to do something about it if they feel they want Stihl to practice differently. I doubt the current US administration is going to bring a suit against a corporation, so it will have to be a different route than the gov. I mean, look at how well some states have been protecting their car dealer networks and blocking Tesla from selling direct to customers. Car dealerships are nearly the definition of a monopolistic trust in how they operate. But the fed gov says the playing field is even cause everyone gots a trusts... This sort of legal practice forgets the reason to avoid the trusts in the first place was that it hurts the consumer, not make a monopoly trust a level playing field for companies.
This Stihl thang is a similar situation. Don't hold your breath. Like a friend of mine once said, 'In Europe, you have tax added to the product after you make it. In America, tax is added before you make it when the companies give money to the politicians.' Two different systems. Although I suspect most systems work closer to the US than the EU system.

Here's a better link to the 'receipt':
Stihl was severely reprimanded in the ruling. Stihl was also fined 7million Euro, too.
https://www.nomosparis.com/en/after...ounced-by-the-french-competition-authority-2/

Will it help us any in the end? I dunno. It's certainly gonna hurt local mom and pop shops. But, hey, life moves on. It isn't 1950 anymore, not even in Ireland...mostly. The internet is here, and on-line is here to stay. Stihl needs to figure out how to make it work. I know some great saw builders that do great on line business. Maybe Stihl can learn from those geniuses.

 

[Evansaw]

The French court found Stihl in violation of not only at least one of their federal regulations, but also of EU regulations:
(https://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:12008E101:EN:HTML).
Basically: Article 101(1) TFEU1 bans agreements and concerted practices* between companies and groups of companies that may affect trade between EU countries and whose purpose is to prevent, restrict or distort competition within the EU's single market.

In other words - a monopoly or monopoly type trust is not legal. Which, oddly, is also the law in the states...but we'll talk more about that later.

The ruling will likely be upheld throughout the EU, which is the largest economic block in the world currently, unless Stihl feels like fighting it in other Euro courts and chancing more fines and reprimands, or flat out being thrown out and penalized by pushing it. So it will be interesting to see how this goes. Prices locally haven't moved any yet, but we are a tiny market for Stihl. I mean, it is like being back in time to live in Ireland. One of the many reasons I live here, tho. But I do notice prices are better on the continent...
Having said this, there is still time for them to fight it in the EU.

It's up to the US to do something about it if they feel they want Stihl to practice differently. I doubt the current US administration is going to bring a suit against a corporation, so it will have to be a different route than the gov. I mean, look at how well some states have been protecting their car dealer networks and blocking Tesla from selling direct to customers. Car dealerships are nearly the definition of a monopolistic trust in how they operate. But the fed gov says the playing field is even cause everyone gots a trusts... This sort of legal practice forgets the reason to avoid the trusts in the first place was that it hurts the consumer, not make a monopoly trust a level playing field for companies.
This Stihl thang is a similar situation. Don't hold your breath. Like a friend of mine once said, 'In Europe, you have tax added to the product after you make it. In America, tax is added before you make it when the companies give money to the politicians.' Two different systems. Although I suspect most systems work closer to the US than the EU system.

Here's a better link to the 'receipt':
Stihl was severely reprimanded in the ruling. Stihl was also fined 7million Euro, too.
https://www.nomosparis.com/en/after...ounced-by-the-french-competition-authority-2/

Will it help us any in the end? I dunno. It's certainly gonna hurt local mom and pop shops. But, hey, life moves on. It isn't 1950 anymore, not even in Ireland...mostly. The internet is here, and on-line is here to stay. Stihl needs to figure out how to make it work. I know some great saw builders that do great on line business. Maybe Stihl can learn from those geniuses.

i ve wrote it before it goes down to the same category of "Cartels"... No company in this planet would like to mix in a Scandal like that.
So far Banks, Manufacturers etc who went into Cartel court cases lost and got huge fines and taxes.

 

[NPKenny]

I recognize that I may be dense, but I am not clearly understanding how this is a monopoly-type issue. Buying a Stihl product is neither right nor privilege. Is it not part of Stihl’s corporate strategy to determine how to get their product most effectively to their consumer?

When I consider monopoly conditions, I think more along the lines of a common necessity, which would be difficult for an individual to replace on his own, for which there is no competitive provider. Standard oil, local water utilities, etc. But in the OPE market, there is plenty of competition, including current online vendors. Further, only a small portion of the populous is a direct consumer.

Why is it important that Stihl be mandated to adopt another model?

 

[CR888]

The French court found Stihl in violation of not only at least one of their federal regulations, but also of EU regulations:
(https://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:12008E101:EN:HTML).
Basically: Article 101(1) TFEU1 bans agreements and concerted practices* between companies and groups of companies that may affect trade between EU countries and whose purpose is to prevent, restrict or distort competition within the EU's single market.

In other words - a monopoly or monopoly type trust is not legal. Which, oddly, is also the law in the states...but we'll talk more about that later.

The ruling will likely be upheld throughout the EU, which is the largest economic block in the world currently, unless Stihl feels like fighting it in other Euro courts and chancing more fines and reprimands, or flat out being thrown out and penalized by pushing it. So it will be interesting to see how this goes. Prices locally haven't moved any yet, but we are a tiny market for Stihl. I mean, it is like being back in time to live in Ireland. One of the many reasons I live here, tho. But I do notice prices are better on the continent...
Having said this, there is still time for them to fight it in the EU.

It's up to the US to do something about it if they feel they want Stihl to practice differently. I doubt the current US administration is going to bring a suit against a corporation, so it will have to be a different route than the gov. I mean, look at how well some states have been protecting their car dealer networks and blocking Tesla from selling direct to customers. Car dealerships are nearly the definition of a monopolistic trust in how they operate. But the fed gov says the playing field is even cause everyone gots a trusts... This sort of legal practice forgets the reason to avoid the trusts in the first place was that it hurts the consumer, not make a monopoly trust a level playing field for companies.
This Stihl thang is a similar situation. Don't hold your breath. Like a friend of mine once said, 'In Europe, you have tax added to the product after you make it. In America, tax is added before you make it when the companies give money to the politicians.' Two different systems. Although I suspect most systems work closer to the US than the EU system.

Here's a better link to the 'receipt':
Stihl was severely reprimanded in the ruling. Stihl was also fined 7million Euro, too.
https://www.nomosparis.com/en/after...ounced-by-the-french-competition-authority-2/

Will it help us any in the end? I dunno. It's certainly gonna hurt local mom and pop shops. But, hey, life moves on. It isn't 1950 anymore, not even in Ireland...mostly. The internet is here, and on-line is here to stay. Stihl needs to figure out how to make it work. I know some great saw builders that do great on line business. Maybe Stihl can learn from those geniuses.

But don't you get it? Learn from saw builders successes...lol. Your talking about the biggest global power equiptment company with the largest dealer presence in probably every country its in. These are ALL brick & mortar dealers/servicing dealers. They want consumers to use their infrastructure, the second you can access Stihl product online, the game changes for them. I'm not agreeing with their practice or policy but I sure as hell know why they are doing what they can to enforce or protect their trade supply lines. Stihl has some challenges to deal with over the coming years no doubt in the changing market. They are running an old model of operation.

 

[Lightning Performance]

So who's going to file a lawsuit in the US?

 

[Mastermind]

But don't you get it? Learn from saw builders successes...lol. Your talking about the biggest global power equiptment company with the largest dealer presence in probably every country its in. These are ALL brick & mortar dealers/servicing dealers. They want consumers to use their infrastructure, the second you can access Stihl product online, the game changes for them. I'm not agreeing with their practice or policy but I sure as hell know why they are doing what they can to enforce or protect their trade supply lines. Stihl has some challenges to deal with over the coming years no doubt in the changing market. They are running an old model of operation.

I respect the fact that Stihl tries to keep their products offline.

For those of us who are well versed in how to operate and maintain these products, it's a bit of a pain in the ass.

But as Mark was saying.....Joe Homeowner could be a different story.

 

[Lightning Performance]

In the US, the corporations own the political system. Hell, they write their own laws.

Don't you go gitin all political now farmer

 

[Mastermind]

Don't you go gitin all political now farmer

I don't take sides. I hate em all.

Merica !!!!

 

[Lightning Performance]

They likely wouldn't.
We get people coming in all the time to the dealership wanting to warranty their broke/defective/improperly installed GM/ AC Delco parts they bought off Rock auto or Ebay.
They then get pissed when told that we cannot warranty that, as it was sold online. GM policy. Return to place of purchase..
But, if bought from any dealer across north America, no problem, we can warranty that.

We all tend to do that when looking for repair work. Warranty on a saw to you is perk to the buyer.
I like the fact that any good company will replace the part and not make me go to the manufacture of said goods. That is now important in a world of knockoffs and poor quality control. Don't care much who makes the part now days. Stihl can and will keep this under lock as long as possible with the online sales and government emissions laws (read lobbyists) in there stable.

 

[00wyk]

I recognize that I may be dense, but I am not clearly understanding how this is a monopoly-type issue. Buying a Stihl product is neither right nor privilege. Is it not part of Stihl’s corporate strategy to determine how to get their product most effectively to their consumer?

When I consider monopoly conditions, I think more along the lines of a common necessity, which would be difficult for an individual to replace on his own, for which there is no competitive provider. Standard oil, local water utilities, etc. But in the OPE market, there is plenty of competition, including current online vendors. Further, only a small portion of the populous is a direct consumer.

Why is it important that Stihl be mandated to adopt another model?

Monopolies are monopolies regardless of now much of a necessity the product is. The definition of a trust or a monopoly have little to do with the product being sold; both in the EU and the States. The thing is, monopolies are super rare, even in a free market. ALCOA was one - a sole provider. Oil companies were mostly trusts. No one oil company had a complete monopoly. And, in most cases, a monopoly or near monopoly was better for the consumer. It kept prices down - but it also kept other providers from operating. Good for the consumer, bad for producers. Trusts, on the other hand, are more complicated. They can prevent both consumers and providers from fair trade. In the Stihl case, one of the issues cited is the inability for dealers to compete in a free on line market - nothing about the consumers in that passage. And, of course, that would have nothing to do with the necessity or importance of the goods in question. It simply has to do with fair trading practices.

It's not a model the EU is forcing Stihl to adopt. It's not a mandate. They are forcing Stihl to obey the trade laws. Stihl has to find a model that complies with the laws. It's up to them, not the government.

If a trust is confusing to you, and it should be, the best thing to do is read about them. It's doubtful you are going to glean much from a forum.
In the US, many businesses skirt the spirit of the anti trust laws daily. Some don't even skirt them.
Some of them have help directly from the judges that preside over the cases. Even the supreme court has ruled that money is free speech.
If money is free speech, how is speech free?

What Randy said about the corporations running the place is depressingly true. But as the supreme court has ruled - money talks.

 

[Lightning Performance]

This, exactly. Another thing: what if the local stealership is no good to you? As in, you don't spend enough money to get the time of day with them, and/or they just don't like you for some reason? An example: a few years ago, my sister wanted a quality electric weedeater and I agreed to find her one. At the time, one of the Stihl plug in electrics seemed like the best choice. The first two dealers I contacted said they couldn't order just one, it was sold in a case of two and after I bought one the second would just sit there collecting dust on the shelf. I ended up buying it from a dealer in another county that kept them in stock and gave me the impression that they actually wanted my business. I know other people on this forum have had the same experience just trying to get parts for their Stihl products. No wonder chicom bootleg parts that work well enough are so popular!

Sad but true. Locally I can just drive by my Stihl dealers to the next one. You don't like me, *f-word off.
If Stihl hired guys like us to go out and rate their dealers.....they might be redirecting some counter personnel training funds or pull a few tickets, just sayin'. Overall I would say Echo in our area is second only to Stihl in volume but not happy customers. You guys and gals listening? You better be...

 

[Mastermind]

What Randy said about the corporations running the place is depressingly true.

I pride myself on being well informed.

That's the only way we don't fall prey to propaganda and disinformation campaigns.

 

[NPKenny]

@00wyk

Excellent response! Thank you! Time to go study-up on trusts and anti-trust laws.

 

[Stump Shot]

My question, is why would a corporation NOT want their dealers to sell online?

Stihl would lose in court. Hell, everybody has the right to sell online.

That's quite simple, Stihl being a fair sized corporation, acts like every other large corporation with the implementation of CYA.
This way, when they make the dealers set up the equipment, it puts a buffer between them and the customer that negates direct liability if/when something goes awry. Even just a little doubt as to the company's responsibility is all that's needed and can save untold millions. And if it comes to it, Joe dealer, straight under the bus, they can always find a new guy, but they can't replace settlements in the tens and hundreds of millions of dollars in the litigious society we find ourselves in.
CYA it's the golden rule for big corporations.

 

[00wyk]

That's quite simple, Stihl being a fair sized corporation, acts like every other large corporation with the implementation of CYA.
This way, when they make the dealers set up the equipment, it puts a buffer between them and the customer that negates direct liability if/when something goes awry. Even just a little doubt as to the company's responsibility is all that's needed and can save untold millions. And if it comes to it, Joe dealer, straight under the bus, they can always find a new guy, but they can't replace settlements in the tens and hundreds of millions of dollars in the litigious society we find ourselves in.
CYA it's the golden rule for big corporations.

You should give a read or youtube about SLAPP lawsuits. I found them interesting, especially the part where if you sue someone and lose, you usually only have to pay your own legal expenses. Since many lawyers that instigate the SLAPP lawsuits are on retainer, they are almost forced to sue, at least on occasion, to justify their own existence. Whereas in most European countries, if you lose your law suit, you must pay the other parties expenses. Makes you think twice before pushing the sue button.