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Boston Acoustics Mobile Tightens Pricing, Distribution Policies

8/16/2011 01:36:40 PM Eastern
Peabody, Mass. - Boston Acoustics adopted a unilateral advertised pricing (UAP) policy for authorized mobile audio dealers and tightened up its distribution policies as part of a plan to boost dealer profitability.

The polices apply to authorized online dealers as well as to brick-and-mortar dealers that purchase direct from Boston Acoustics and those that purchase through distributors.

Boston Acoustic mobile did not previously have a minimum advertised price (MAP) policy, only suggested retails, said national sales manager Sanjay Sharma. Under the UAP policy, he continued, "Dealers are free to advertise our products for whatever they choose, and we are free to take action, or not to take action, for those choosing not to follow UAP, including not selling them the line."

In another change, dealers who buy through authorized distributors are "are now required to go through the authorization process and agree to the terms of sale, which is an enhancement to the previous policy," Sharma told TWICE.

These dealers, direct dealers, and distributors are all required to register with a new web portal to electronically sign revised reseller agreements, which include product-rebate policies. The agreements also prohibit transshipping, which was also prohibited in Boston's previous agreements as well.

"Our new channel management initiatives will create stability in how our brands are positioned in the market, and our authorized dealers should enjoy a more attractive realizable margin that they can re-invest in driving performance brands like Boston Acoustics," Sharma told TWICE.

The new strategy is designed "to ensure that end users purchase only from authorized resellers capable of communicating the Boston Acoustics technology, innovation, performance and brand benefit messages," the company added in a statement.

Premium manufacturers spend substantial sums of money on research and development, product quality standards, and other practices "necessary to maintain and protect their brand integrity," the company continued. "Likewise, the authorized dealers for these manufacturers need to be able to earn the higher profits necessary for them to reinvest, differentiate their businesses, properly promote the products, and effectively communicate the premium brand and technology messages."
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