Festool TTS fined 8.2 million Euros for price fixing!

[festool_user]

As a long term Festool user I am happy to see that Festool are finally being investigated for their price fixing and underhanded techniques!

Bundeskartellamt fines TTS Tooltechnic for vertical price fixing
Bonn, 20 August 2012: The Bundeskartellamt has imposed a fine of 8.2 million Euros on TTS Tooltechnic Systems Deutschland GmbH, Wendlingen ("TTS") for setting up and imposing a vertical resale price maintenance system.

Under the trademark "Festool" TTS sells high-quality power tools for joiners, painters, car sprayers and discerning private clients. These products are selectively distributed and sold exclusively in specialist stores. The proceedings were triggered by complaints from the specialist trade, which had been asked by TTS to strictly observe the "non-binding price recommendation" (RRP). The specialist outlets were threatened with disadvantages such as worse conditions or contract suspension if they deviated from this price.

Andreas Mundt, President of the Bundeskartellamt: "Particularly in the case of products with significant market relevance, vertical resale price maintenance harms both the consumer and craftsmen`s trade. In order to achieve effective deterrence in such cases, an appropriate fine is therefore necessary."

TTS's competition law infringement could be proved in a series of hearings with personnel of the specialist trade involved. A representative selection of specialist outlets were questioned as witnesses and thus obliged to provide correct and complete information about the case.

TTS has agreed to have the proceedings terminated by way of a settlement. The Bundeskartellamt's decision can be appealed to the Düsseldorf Higher Regional Court.

Shame on you Festool!

 

[Charlie Woody]

I agree!

But will this mean they drop their prices, or will they find a way around it?

 

[festool_user]

We shall see, they will probably start selling direct from their website now! :roll:

 

[Yetty]

Whopping 8.2 MILLION EURO FINE !!! - should be interesting to see whether TTS appeal.


Who is Bundeskartellamt ? Taken from their website:
"The Bundeskartellamt is an independent competition authority whose task is to protect competition in Germany."

Here is the link to the original Press Release (as shown in original post) from Bundeskartellamt:
http://www.bundeskartellamt.de/wEnglisch/News/press/2012_08_20.php


I smell change in the air, and it's sweet!

 

[track821ok]

beat me to it i was just going to post this info too

suprised this hasn't happened sooner - tooltechnic were done in australia some years ago.

 

[Yetty]

...tooltechnic were done in australia some years ago.

didn't know that, interesting, thanks.

 

[track821ok]

...tooltechnic were done in australia some years ago.

didn't know that, interesting, thanks.

happy to help - more info here :wink:

http://www.accc.gov.au/content/index.ph ... mId/776481

 

[Paul Chapman]

The only surprising thing about this is how long it's taken for the authorities in Germany to do something about it. Presumably they will continue price-fixing over here unless the UK authorities take their own action?

Cheers :wink:

Paul

 

[RogerP]

There's one course of action that would have instant effect - stop buying their products - a consumer strike!

But that'll never happen - will it?

 

[James C]

I'm sure if they had a price reduction every now and then they would end up with more customers. Most people who buy their products seem to keep coming back.

It's still too rich for me.

 

[Dodge]

Sorry but I think all Festool equipment is way overpriced - Yes their is no doubt it is good quality but I refuse to pay through the nose for things!

 

[Hardwood66]

Just means they will put the prices up not down there not silly, like every big company there all about profit they only way they will give us reasonable prices if people stop buying till they drop them down but we all know that won't happen

 

[thomvic]

The issue here is not that Festool is fixing prices but that it has been preventing it's retailers from discounting from the recommended retail price. The trade price which Festool distributors are recommending it's retailer sell at probably gives the retailer a 50% markup resulting in a 33% margin for the retailer. This is fairly standard in this market but some retailers would be happy to take a lesser margin in order to increase total sales. Festool's restrictive contract terms have been preventing this - to the disadvantage of the end user.
I believe that similar practices are prevalent in the UK - hence most woodworking machinery is pretty much the same price whichever retailer you use.

Richard

 

[Paul Chapman]

The issue here is not that Festool is fixing prices but that it has been preventing it's retailers from discounting from the recommended retail price.

What's the difference :?

Cheers :wink:

Paul

 

[white_sw]

I've always been told by retailers that they are prevented from discounting Festool products and even spoke to Trading Standards around it. However, there are two retailers that I know who do discount Festool. Powertool World discount by 10.5% off RRP, then an additional 4.5% for platinum club members. Membership doesn't cost anything. Then there is SIA Agencies who, for me, have always beaten the best price I have found including 2 day delivery from Belfast. On my last purchase, they beat the price I could get from PTW (by a good amount) and chucked in about 50 quids worth of extra's FOC.

So if Festool prevent retailers from discounting, how do the above get away with it ? and have done for some time.. PTW are even currently prompting this to their customers.

Cheers,
Sam

 

[Cheshirechappie]

At the risk of being over-simplistic, there's a very simple solution - just don't buy the stuff. The world isn't short of decent power tools.

 

[houtslager]

too bloody right, I was really pissed off yesterday, got the kapex 120 a month ago and was just starting a new project, where the joints had to be spot on.
Imagine my surprise, when I taped the joints up tight, flipped it over and started to fold the bits in on each other. :evil: :evil:
WOW, 5mm difference !%$%^@^^ :roll: :shock:
plus the joints = 45 deg. miters were tight at one end but the base, the miters were open ! :evil: :evil: :evil:
Took it back and was told 2 weeks ! ^%#&$#$ €1600 and the bleeding thing could not even cut square !
:shock: :shock: :shock:

Told the Rep, stuff it ! take it back and I'll buy the Bosch Co-axial chop saw.
He was not amused :twisted:

He said if I took it to the Dutch head office of TTS they would sort it out there and then.
Thought about it, and agreed - 1 chance to get it right or back to the shop it goes.

Well I took it to TTS this morning [ 70min drive ] it took TTS 2 attempts to get it to saw 90deg. and do 45 deg. mitres.

To be truthful, it's not 100% but for this project it will do. But. I am still thinking of sending it back to Germany.
TTS sucks as a company, but some of its staff are toppers.

A disgruntled Festool user.

K

oh anyone want a used Domino 500 for 500PS ?

 

[Shrubby]

About time they were fined
The solution to Festering stools arrogance, poor UK agent and unremarkable tools is to simply buy something else.
Matt (who used to like them 15 years ago)

 

[custard]

If (or rather when) the Euro falls apart then any German or Austrian product will be, at the very very least, 20% more expensive overnight.

 

[Yetty]

If (or rather when) the Euro falls apart then any German or Austrian product will be, at the very very least, 20% more expensive overnight.

Can you explain further why?
(I'm not challenging your comment - I just want to better understand the steps of your reasoning)