The Netherlands Authority for Consumers and Markets (ACM) has warned various suppliers of baby and children’s products. ACM receives many reports about suppliers exerting undue influence over the retail prices of their products sold by retailers. In this way, suppliers keep the retail prices of their products artificially high.
ACM has issued warnings to suppliers of, among other products, strollers, car seats, baby carriers, children’s clothing, children’s furniture, sleeping products, toys, bottles, and pacifiers. ACM keeps a close watch on various companies to see if they comply with the rules. Companies risk fines of up to 900,000 euros or 10 percent of their turnovers if, after these warnings, they do not comply with the rules.
Michiel Denkers, Director of ACM’s Competition Department, explains: “Retailers must be able to set the retail prices of the products in their stores, either online or brick-and-mortar ones, themselves. Suppliers can only give retailers non-binding price recommendations, and cannot exert pressure on retailers to increase the retail price nor can they provide information about the pricing strategies of other retailers. Parents want what is best for their child. Therefore, they are often less critical, and are prepared to spend more. It seems as if, in this sector, suppliers take advantage of that mentality. Young parents are thus harmed, while this phase of their lives already comes with enough expenses as it is.”
Recommended retail prices must be non-binding
Suppliers must enable retailers to set their retail prices themselves. That is why suppliers are only allowed to give retailers non-binding price recommendations. In this way, retailers are able to compete fairly with each other, and parents or grandparents pay the best price for baby and children’s products. Suppliers are also prohibited to provide information about the pricing strategies of other retailers.
ACM regularly receives reports from retailers of baby and children’s products that they are forced to charge certain prices. That is why it is important that all suppliers of baby and children’s products check whether they comply with the rules.
In order to offer suppliers and retailers guidance, ACM has created a checklist (in Dutch) for recommended retail prices. Suppliers can use this checklist to see whether they comply with the rules. Retailers can check whether their supplier exerts undue influence over the retail prices in stores (online and brick-and-mortar ones).
Report illegal agreements to ACM
Do you suspect suppliers exerting undue influence over retail prices? Help us by filing a report.