On Friday 10 Aug 2007 3:49 pm, Gautam John wrote: > Ought retailer be free to fix the > maximum and minimum price according to market topography and > independent of the price it pays the manufacturer for said product?
I think the idea here is to prevent rampant profiteering by stating a maximum allowable value for the product. I believe that this rule is similar in intent to the Reliance and other supermarket chains actions in keeping prices for the consumer down. In the case of MRP - no matter how many middlemen there are (each of whom take a cut) the MRP cannot be exceeded. In the case of the supermarket chains the profiteering middlemen are being cut out altogether, and, in fact, I believe the producer is often being offered a better procurement price. Procurement prices from producer are typically kept low by the middlemen, while a series of middlemen take in profits as the item passes thruugh his hands. The recent agitation in Bangalore was from these middlemen - whose profiteering is under threat from organized supermarket chains. shiv
