Festool UK TTS fined 8.2 million Euros for price fixing in Europe!

They are not forcing festool to discount. They will still sell them for the same but will let dealers offer a discount
 
The issue here is that a supplier/ manufacturer (Festool) is forcing dealers to sell at a fixed price when dealers want to be competitive- it's nothing to do with evening the playing field for online and bricks-and-mortar dealers. I'm surprised at the number of FOGgers who seem to be supporting anti-competitive practices by saying they can't see what's wrong with Festool's policy.

If I buy a Mercedes and then choose to sell it on for half-price, that's up to me. Imagine if Mercedes came after me for that and threatened to refuse to sell me another car. That's sort of what Festool is doing and why they were fined.

Dean, you absolutely nailed it whilst I was replying.
 
I'm all for discounts more the merrier  . but I carnt see festool doing it a dealer I use got ther contract with festool revoked for a period of time decause they sold some tools cheaper then festool wanted them too.
 
luke1984 said:
I'm all for discounts more the merrier  . but I carnt see festool doing it a dealer I use got ther contract with festool revoked for a period of time decause they sold some tools cheaper then festool wanted them too.
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and that is precisely why they have been fined - for price fixing. The downside of this is that TTS now have to recoup a loss of €8.2 million so we can all expect to be paying even more in future.
 
Richard Leon said:
The issue here is that a supplier/ manufacturer (Festool) is forcing dealers to sell at a fixed price when dealers want to be competitive- it's nothing to do with evening the playing field for online and bricks-and-mortar dealers. I'm surprised at the number of FOGgers who seem to be supporting anti-competitive practices by saying they can't see what's wrong with Festool's policy.

If I buy a Mercedes and then choose to sell it on for half-price, that's up to me. Imagine if Mercedes came after me for that and threatened to refuse to sell me another car. That's sort of what Festool is doing and why they were fined.

Dean, you absolutely nailed it whilst I was replying.
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Why would Festool care how much dealers sold their stock at as long as the dealers buy their stock from Festool at the prices Festool sets?
 
It's not the first such fine they get, and probably not the last. It's probably calculated into the current prices!
What they are doing is protecting local professional shops, so that users can go there for advice, testing, and have most things in stock for urgent use. Without fixing the prices, no brick and mortar shop would be able to go up against big internet dealers, and they would stop offering them.
It's legal in the states, where it has brought other problems, but here not being able to protect a market has led to the disappearing of most independent hardware shops. most are now part of the same group, that group becomes dominant, can buy for low prices, and fix the prices in their own shops.

Its not about getting a good deal for buying 3 mercs, they will laugh at you because local importers order them by the hundreds.
It kills the small business, and makes the big ones richer.
 
When our local Festool dealer shutdown, Festool came and collected all the (non-demo) Festool stock.

Why? Because they owned it. It's not your usual model where the dealer pays wholesale for the product and also takes the risk for selling it or having it hang in stock.

Maybe there are other types of agreements available? Otherwise, if Festool actually maintains ownership, I don't see why they can't set their own price?

Don't get me wrong, I'd love to get a discount, but....
 
fritter63 said:
When our local Festool dealer shutdown, Festool came and collected all the (non-demo) Festool stock.
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This is insightful.  So Festool actually owns the dealer stock (I'm assuming this to be the case) maybe dealers can chime in.  :)
 
I think you'd find that the dealer just hadn't paid for that stock and Festool were reclaiming
their property. Dealers buy the stock and pay on credit terms such as 30 days after invoice or end of month following delivery
 
Instead of hashing this topic over and over again why not go after the gasoline companies for gouging us on
Gas and
Jacking up prices overnight sometimes then declaring 35 billion dollars profits

Festools is not price fixing neither is apple and many more. This is the price of the
Tool. You either buy it or you don't. Period as simple as that

Other companies sell drills or saws buy theirs then. All most of you are concerned about with this topic is
That you don't want to pay their price and want it cheaper to save you money. But yet where you work do you want a less paycheck?  Or bid a
Job and have customer say well I can get it cheaper elsewhere. And you say well not with my quality and skills you can't.

Same thing   Buy I'm or don't. It's your
Choice
 
Timtool said:
What they are doing is protecting local professional shops, so that users can go there for advice, testing, and have most things in stock for urgent use. Without fixing the prices, no brick and mortar shop would be able to go up against big internet dealers, and they would stop offering them.
It's legal in the states, where it has brought other problems, but here not being able to protect a market has led to the disappearing of most independent hardware shops. most are now part of the same group, that group becomes dominant, can buy for low prices, and fix the prices in their own shops.
Click to expand...

This model is one of the reasons we enjoy such great dealer support and high resale prices on Festool products in the US. Dealers are able to offer service and support knowing that they won't be undercut by an online supplier with little overhead. This model is prevalent in the bicycle industry, especially with the big 3 (Specialized, TREK, and Giant) .
 
fritter63 said:
When our local Festool dealer shutdown, Festool came and collected all the (non-demo) Festool stock........
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I don't know dealer's contracts but I'd be surprised if they didn't own the stock.  I believe Festool buys back any unsold inventory so there are no discounts offered by any dealer, even the ones going out of business. 
 
Well, I wonder if Festool has changed its pricing policy for real, since at least one online dealer has lowered the Syslite price lately.
 
Hi reiska I think on line stores will find a way around selling tools etc at discounted prices by way of advertising say for instance ex display , have a look on eBay for prime examples of this also look at the price of the carvex 400 , I called a store a while back to do a price comparison and sure enough the product was ex display well what a surprise , I wonder if festool are telling dealers to drop the carvex 400s as they will soon be phased out also does festool give the retailers the loss on such tools in the way of discount on new stock ? I am sure there must be someone on the fog who can answer that , green .
 
@JC
I am disgruntled because Festool's service has proved inadequate for my needs one too many times. I am not here to flame though, I would prefer to discuss and inform.

My two cents-:

I would normally prefer to buy locally from my dealer for power tools and normally do, but because Festool have threatened them for discounting they cannot sell their tools any cheaper, instead they add freebies. Whereas Power Tool World have offered me 10.5% off RRP, with an additional 4.5% for platinum club members!

Everything seems pretty inconsistent and because of their pricing structure i feel it encourages shady dealings. [scared]
 
Good Morning

Head above the parapet time. Well it would be rude just to lurk in the background.

My initial thoughts as a dealer....

Initially bad for FESTOOL, who wants to get fined that amount of money? But as long as they can afford it then it shouldn't be a real problem. How things pan out after that who can tell.

Dealers are in for trouble I think, all it takes is one high profile internet discounter to take the profit out of a product and dealers will lose interest in it. We may find fewer demonstration tools being available, loan machines unaffordable, experienced well trained staff less keen to spend valuable time with a customer discussing products and stocks being reduced to make space for more profitable lines?

End users may well cheer at the prospect of discounted tools, hey who wouldn't want a heafty chunk off a KAPEX? But only time will tell if lower prices for customers and lower margins for dealers (which is where the discount will come from) means worse or better service and availability.

A lower cost could be a high price to pay?

Whatever happens we still love the product, I just don't want to see is as just another commodity, discounted on the front of glossy catalogues. Lower prices for me often means lower value.

Best regards

Warren
 
disgruntled_user said:
@JC
I am disgruntled because Festool's service has proved inadequate for my needs one too many times. I am not here to flame though, I would prefer to discuss and inform.

My two cents-:

I would normally prefer to buy locally from my dealer for power tools and normally do, but because Festool have threatened them for discounting they cannot sell their tools any cheaper, instead they add freebies. Whereas Power Tool World have offered me 10.5% off RRP, with an additional 4.5% for platinum club members!

Everything seems pretty inconsistent and because of their pricing structure i feel it encourages shady dealings. [scared]
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To be fair to everyone you should point out that it is tts uk that you feel has fallen short of your expectations.
 
honeydokreg said:
Instead of hashing this topic over and over again why not go after the gasoline companies for gouging us on
Gas and
Jacking up prices overnight sometimes then declaring 35 billion dollars profits

Festools is not price fixing neither is apple and many more. This is the price of the
Tool. You either buy it or you don't. Period as simple as that

Other companies sell drills or saws buy theirs then. All most of you are concerned about with this topic is
That you don't want to pay their price and want it cheaper to save you money. But yet where you work do you want a less paycheck?  Or bid a
Job and have customer say well I can get it cheaper elsewhere. And you say well not with my quality and skills you can't.

Same thing   Buy I'm or don't. It's your
Choice
Click to expand...

Kreg not everyone wants bead board [big grin]
 
I'd be happy if pricing across the planet was a little more "fair".

There are a lot of local reasons why a Porsche costs 2.5 times more in Oz compared to the US (some very nasty taxes), but there's no "luxury tool tax" and Bosch US to Oz is a very different ratio to Festool US to Oz.

There are a lot of go to market strategies Festool can employ to ensure effective representation and expertise in the field and still allow reseller price flexibility. They have a LOT of growing up to do as a business - but I still like their tools ... overpriced as they are!

 
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