Watchdog warns suppliers of baby and children's products over high pricing
Various suppliers of baby and children's products are pressuring retailers to maintain artificially high prices. The Netherlands Authority for Consumers and Markets (ACM) received multiple signals regarding this matter and issued a warning on Monday.
These signals involve suppliers of various baby and children's products such as strollers, car seats, baby carriers, children's textiles, children's furniture, sleep products, toys, bottles, and teats. The ACM is closely monitoring several companies for compliance. The competition watchdog warned that failure to comply with the warning could result in a fine of up to 900,000 euros or 10 percent of their turnover for these companies.
The ACM suggested that suppliers are capitalizing on the inclination of parents to provide the best for their children. This frequently results in parents being less discerning and more open to spending more. Michiel Denkers, the Director of the Competition Directorate at the ACM, emphasized this concern, saying, "Young parents are the victims of this - while this phase of their life already demands a lot of expenses.
To maintain a level playing field, suppliers must give retailers the freedom to determine their own prices for consumers. Consequently, suppliers are only allowed to propose non-binding price suggestions to retailers. "Suppliers should limit themselves to making price recommendations and should not pressure retailers to raise prices or divulge information about other retailers' pricing."
The ACM regularly gets feedback from retailers of baby and children's items indicating that they are compelled to set certain prices. Thus, all suppliers of these products must verify their compliance with regulations.
To assist both suppliers and retailers, the ACM has introduced an advisory price verification tool. This tool allows suppliers to check their compliance with the rules and retailers to check whether their supplier is exerting undue influence over their pricing strategy in their physical or online stores.
