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Fair SellingIf you are selling products to the retail or wholesale trade, you need to sell on equal terms to outlets that may be deemed to be competing with each other, unless you can economically justify different terms. You cannot sell one hundred green pencils to stationery store A for $30 and sell an identical batch of one hundred green pencils to a competing stationery store for $35 without clear economic justification.A clear economic justification may be that one store pays cash in advance for your product, while another store retains the right to return unsold goods to you after a period of time. One store may require that your product be individually boxed. High volume can be a basis for a deeper discount if it can be economically justified. You must be able to show that the higher volume actually lowers your cost of doing business. Not only must pricing be nondiscriminatory, but other terms of the sale must be equal as well. Those terms may include payment method, advertising allowances, and freight allowances, among others. The main concern of the courts is that larger retailers and wholesalers may be demanding and getting better terms than their smaller rivals without any cost justification. * Source Streetwise Small Business Start-Up |
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