On Friday, November 16, fabric company RJR sent an email to retailers notifying them of a minimum advertised pricing (MAP) policy that will go into effect for Cotton+Steel on December 1, 2018. Minimum Advertised Pricing (MAP) is a policy in which a manufacturer limits the ability of retailers to advertise prices below a certain level.

“Adopting MAP policies will enable our authorized partners to invest their time, energy and resources in selling and profitably marketing C+S products,” the email stated. “Equally important, the established criteria set forth in the C+S Brand Sales Policy will support our efforts to maintain the C+S premium brand image,” the email went on to say. RJR did not respond to my requests for comment for this story.

What is MAP?

MAP pricing only applies to the advertised price of a product, not to its actual price. Retailers are still able to sell those products at any price they choose, as long as it’s not advertised anywhere. For brick-and-mortar retailers, this means the in-store price can be lower than the MAP price. Things get trickier for online retailers, however. US Circuit Courts and FTC rulings have said that while listings are advertorial, checkout pages are transactional and can display the actual price of the product. Once a consumer adds the product to their cart, the price drop can be revealed as long as the MAP price was shown on the listing page.

MAP pricing is not to be confused with manufacturer’s suggested retail price (MSRP) which is a price the manufacturer suggests retail partners use when selling their products. Cloud9 Fabrics has always had a MSRP for the first 60 days after a collection is released, after which shops can discount the fabric however they’d like. “They need to turn merchandise (just as we do), and we cannot force them to hold this price for an eternity,” says co-founder Gina Pantastico.

RJR’s MAP policy

RJR’s MAP policy for Cotton+Steel is much more rigorous than that. Retailers are required to sign a brand sales agreement. Part of this agreement states, “Cotton+Steel resellers that discover a violation by another Cotton+Steel reseller are encouraged to report to Cotton+Steel Fabrics.” Violators risk having their purchasing rights revoked for periods of 30-90 days. A FAQ document explains that the company will be contracting with “an outside enforcement agency that will monitor online advertised pricing.”

The new online sales application includes other measures that seem designed to eliminate small, online retailers from ordering Cotton+Steel fabrics. RJR has raised its minimum annual order of Cotton+Steel from a $1,500 initial order with no annual minimum reorder to a $5,000 annual minimum reorder. Additionally, ecommerce sites must have a landing page that exclusively lists Cotton+Steel products and must display those products “in a manner that is consistent with the Cotton+Steel brand image as determined by C+S in its sole discretion.”

One small, online retailer I spoke with said MAP pricing made selling Cotton+Steel fabric impossible for her. “My annual spend is only 10k with them and I’m done. There’s no way I could adhere to these guidelines,” she says. “The only way I could do it without drastically increasing my inventory would be to either sell by the pound to not violate the per yard prices, or partner up with promos like, ‘buy 1 yard of Cotton+Steel, get 1 yard of Robert Kaufman Kona for free’ or some weird combo like that.”

And some bolts just don’t sell until they are clearance. I have lines I thought would do well that just sit on the shelf. I can’t imagine not being able to run a sale. I will miss carrying Rifle Paper fabrics, but with the move of the original designers to Ruby Star Society at Moda I will just move my business there. I already have a Moda account and they are extremely easy to work with,” she said.

MAP protects brick-and-mortar retailers

Ricky Brooks has had a MAP pricing policy in place since he founded RNK Distributing in 2004. “We’re seeing quilting retailers under attack by online sellers,” Brooks says. “But online sellers are obviously here to stay. I started RNK with a MAP policy because I promised my retailers that they would never have to be embarrassed or ashamed of the price of their products.”

Brooks says MAP pricing has hampered some online retailers from carrying RNK’s products. “They’ll have it, but it won’t be their best sellers. Their best sellers will be products with lower prices.” But RNK has a different focus. “We are dependent on the people who can show the quality of the product, who can demonstrate it and educate consumers about it. We’re catering to those stores. So yes, it can impede your business with online retailers, but the more it does, the more it builds your business with the brick-and-mortars.” Even so, RNK’s third-largest retailer is an online-only store that abides by the MAP pricing policy.

For Stephanie Soebbing, MAP pricing provides a welcome relief to the constant race to the bottom on price. Soebbing started her fabric store, Quilt Addicts Anonymous, online and opened a brick-and-mortar in Rock Island, Illinois a few years later.

“For the first year I struggled with how to compete on price before finally realizing I never could and needed to deliver value in other ways, like free video tutorials, subscription clubs, and creating fun projects others would want to do,” she says.

“We’ve seen large online retailers offer incredibly popular pre-cuts to the consumer for less money than we paid the manufacturer to buy the bundle less than a week after the collection shipped. That just makes the big guys richer and puts the small guys out of business. And we need the small guys, too. Even Jenny Doan can’t get you a spool of thread the same day when you run out on the Saturday before Christmas. You need your local quilt shop for that.”

Is MAP going too far?

Stephanie Thiesen’s shop, Crosscut Sewing, also started online. She now has a brick-and-mortar in Melrose, Massachusetts. Thiesen is open to the idea of MAP pricing, but would prefer for the policy to have a defined time limitation. “One of the most common complaints in the industry is how much fabric is produced,” she says. “By the time shops receive a line of fabric, often the manufacturer is already promoting a future collection. It gives a sense of urgency to sell through fabric. I think it would be great to have a MAP policy that kept the pricing consistent for a defined period of time. If I knew that I would be selling the fabric at full price for six months or so, it would give me the time and incentive to make some samples, write a blog post and promote it on social media.”

As it stands, RJR’s MAP pricing policy makes Thiesen nervous. “I have 800 square feet of retail space,” she says. “I need to be able to rotate inventory and discount what isn’t selling.”

RJR Enforces MAP Pricing for Cotton+Steel; Retailers React

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