[Avodah] ona'ah and on-line discounters

[Shoshana L. Boublil]

> Date: Wed, 14 Feb 2007 20:20:15 -0500 (EST)
> From: Harry Weiss <hjweiss at panix.com>
> Subject: Re: [Avodah] ona'ah and on-line discounters
> Message-ID: <Pine.NEB.4.64.0702142011040.19200 at panix1.panix.com>

It is always useful and educational to discover how an industry works from 
the inside, before using lables such as "ono'ah".

>> From: "Michael Kopinsky" <mkopinsky at gmail.com>
>
>>> Books, and many other commodities, now have a "label" price and a 
>>> "street"
>>> price which are different, due to the common presence of discounters.

> Would Onaah even be an issue here.  The list price is the real price.  If
> you call Artscroll or Felheim you will ususally pay list.  There are many
> other retailers that do charge that list.

When a book is first published, a "List Price" is determined.  All 
transactions concerning this book will be based on this price.

Publishers will sell the book to distributors based on this price.  For 
example, a distributor will receive an automatic 33% discount from the 
publisher.  There is a book vendor here in Israel that demands a 50% 
discount from list price when undertaking to distribute privately published 
books.

The difference between the list price and the price paid by the distributor 
is the basis of their profit.

Publishers and distributors will, most of the time, come to an agreement 
whereby the publisher cannot sell the book at a discount of more than 10% 
(or some similar figure)  so that the distributor can still decide to give a 
discount (for whatever reason) and won't find himself facing the situation 
of a client saying that it's cheaper to buy from the publisher (which would 
put all distributors out of business).

That is why you can find different prices from different sources.  Each 
distributor makes up his own mind as to the profit margin he seeks (number 
of books sold vs. price per book), and sets his street price.

On line discounters have an additional advantage -- they usually don't have 
storage fees.  They only order the books from the publisher or distributor 
when they have an order in hand.  That is why some on line stores will note 
that while some books will arrive shortly (2-3 days) others may take 4-6 
weeks to arrive.

Shoshana L. Boublil