Presentation on theme: "Retail price maintenance Jade Ho (17) Natalie Hui (18)6A."— Presentation transcript:
Retail price maintenance Jade Ho (17) Natalie Hui (18)6A
Summary of the news In 2010, UK’s Office of Fair Trading investigate allegations of resale price maintenance in the hotel industry
Nowadays, the sale of hotel rooms over the internet has become popular The hotels have been forcing those websites (in this case, skoosh.com) to set the price at the “cheapest” minimum resale prices
Skoosh.com either have to raise prices or take the hotels off their list You have to set according to our suggested price! Otherwise, we’re not supplying rooms to you! Hotels Skoosh.com (hotel rooms retailing website)
Effects Under resale price maintenance, hotels themselves imposed a minimum price on online hotel room sales
Stakeholders Hotel industry There is very little variation in prices. No price competition will take place within the hotel industry Avoids price war Effects
Stakeholders ConsumerConsumers may look at several websites and see the same prices advertised. Positive: They can pay the same price wherever they use the online hotel room sales. Information cost could be saved. Negative: The price set by the hotels may higher than the market price, so the price paid by consumers increased.