I am an unabashed free trader.  I have always been and always will be.  This is a rant most of my business associates have heard before, but I never tire of making it.  So, I will make it again here.

The distribution of scuba diving equipment, at the wholesale level, is very tightly controlled by the manufacturers.  Every local scuba store signs dealership agreements that tightly control how the store may resale the merchandise to consumers.  Restrictions on internet advertising and price issues are the most restrictive of all dealership provisions.

During the holiday shopping season, savvy shoppers are always looking for deals and discounts.  Newspapers are thick with sale pages and ads for the big box stores, ski equipment retailers, and speciality stores of all types, all offering the best prices of the year. Radio stations are saturated with 30 second spots highlighting the best prices from all sorts of retailers.  Your mailbox is cluttered with direct mail advertising, mostly trumpeting the great prices available to you.   In fact, if discounts aren’t offered, consumers will simply shop somewhere else.  Why would they spend their limited holiday funds to buy items that are no cheaper during this sale season than any other day of the year?  Consumers have a limited amount of money to spend during the holiday season; they just can’t afford to spend it where no bargains are offered.

You local scuba diving store is often boxed out of the gigantic spending season by their dealership agreements with the wholesale manufacturers.  Price advertising is typically limited to a Minimum Advertised Price (MAP) for each individual item.  This MAP price is typically nothing more than 5% or 10% off of the published Suggested Retail Price, not nearly enough of a bargain to motivate consumers.  Some manufactures even specify Minimum Acceptable Resale Prices.  These rules actually restrict the ACTUAL price the dealer can charge the customer at the cash register.  Such rules make it almost impossible for the local scuba store to create any buzz or traffic during this season.  Why would the consumer buy a regulator (that they can’t use for several more months) during the holiday shopping season when the price is no different from the price in July?

Most will immediately say “Isn’t this illegal?”  Unfortunately, it is not.  Various Supreme Court rulings  over the past 100 years have made it perfectly acceptable for a manufacturer to insist upon price and advertising restrictions….all under the guise of “protecting the value of the product” and “providing margin protection for the dealer base”.  This level of manufacturer control was just reaffirmed last year in a landmark case called Leegin vs PSKS.  Your local scuba store simply has no latitude in light of these rulings and the restrictive policies of the scuba manufacturers.  The real impact of these restrictions simply forbids the local scuba store from enjoying the benefits of the largest spending season in the United States.

Those of us who operate scuba internet retail websites have found ways around these restrictive policies.  Stores with the capability and resources to operate a successful internet store are often more savvy at advertising, have larger budgets to get our message out, and are far more experienced at working with (actually around) the manufacturers restrictions.  Unfortunately, the average local scuba store is not in that position.

So, as the holiday shopping season moves into full swing and the money begins to flow, your local scuba store owner simply must put his head in the sand and hope for warmer weather.  No matter what he wants to do with HIS business, the supply restrictions prevent him from acting.

If any scuba manufacturers are reading this, I have a simple question….Just who are you protecting?  Who benefits from these restrictions?  Why can’t an American business man do what he pleases with product he has purchased and paid for?

Oh well, just my routine rant against those that block us free traders.  Maybe one day, someone will listen.

Phil Ellis

Discount Scuba Equipment with Full Factory Warranty