Monday, February 16, 2015

Garmin Minimum Retail Price (MRP) Policy

MRP Pricing - What It Means:

Within the last two years, Garmin instituted a Minimum Retail Price (MRP) policy that they apply to several products. The goal is to protect the retail pricing structure and preserve profit margins for dealers and installers. In sum, all dealers and installers are supposed to sell certain items at the exact same price. No discounts, free accessories, coupons or other gimmicks are permitted.

How MRP Pricing Affects You:

For retail customers, the best any dealer can offer is free shipping on some MRP items. Garmin will not allow dealers to pay your sales tax (if applicable), or provide any free accessories. You may be eligible for a trade-in allowance, depending on what you wish to trade. In essence, a dealer may offer to buy your outdated equipment from you as part of the transaction, but cannot advertise how much of a trade allowance is offered. Trades can be negotiated on a case-by-case basis.

For service customers (installed units), installing dealers can use multiple methods to offer you a savings. Installers may offer some portion of the labor for free or at a discount, or other non-MRP products may be discounted. If you are having your new Garmin products installed, be sure to use an ABYC or Garmin Certified installer. This way you are eligible for a two-year, on-board warranty!

How does Garmin Monitor Pricing?

On occasion, Garmin will have a Secret Shopper place an order or get an estimate from a randomly selected dealer for a MRP product. If the transaction satisfies the MRP policy, all is good, and both Garmin and the dealer are happy. If the transaction does not satisfy the MRP policy, Garmin may penalize the dealer by denying product sales or support.

What You Should Watch Out For:

If you are purchasing a new Garmin product that is subject to their MRP policy, be prepared to pay the full retail price. If your dealer is willing to negotiate a lower price or throw in free accessories, you may benefit from the savings in the short term, but you will likely not be able to get product support from that same dealer in the future.

Summary:

I am excited about the new products that Garmin continues to offer. Their innovation is unmatched in the industry. At the same time, inter-connectivity is very important. For years, Garmin has kept it simple with industry-standard networking protocols. Garmin's NMEA 2000 networks use standard Micro-C connectors, and are interchangeable with Maretron and other manufacturers connectors. Garmin's Ethernet networks use regular RJ45 connectors that you can install using a RJ45 crimp tool. Chartplotters use standard SD or Micro-SD memory cards that you can buy anywhere (keep in mind capacity limits).

I think Minimum Retail Pricing strategies are here to stay, and will prevent dealers in the industry from cutting each others throats. In an even MRP playing field, the dealer/installer that offers the best value - knowledge, skill, product availability, and customer service - will achieve success.

Happy Cruising!
Tim Allen

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