The penalty for violating a brand’s Minimum Advertised Price Policy is fairly straightforward: If the reseller won’t stop listing products below the MAPP price, they ultimately lose the privilege of selling those products. Termination is the most drastic step that can be taken since violating MAPP is not illegal. Therefore, the incentive for following MAPP is continuing to work with the brand or its distributors.
But whether a company uses a software package like MAPP Trap’s Auto-Enforcement, MAPP Trap’s White Glove service or they do enforcement in-house, it’s important to make sure certain specific internal stakeholders are in the loop. Who those people are can vary from company to company, but at the very least, brands enforcing MAP Policies should make sure the following personnel are involved:
MAP Policy Administrator
There should be one single company point of contact -- an assigned MAPP Administrator. All incoming, MAPP-concerned calls and emails should be directed to that person. There are both legal and operational reasons for this.
From the legal side, MAP Policies have specific, contractual, anti-trust and practical requirements that not everyone in your company will understand. Therefore, training one person in the requirements of minimum advertised price policy and MAP enforcement is essential. A person who hasn’t been trained in MAP enforcement and brand protection might say something to a contact that is contradictory or untrue which could lead to confusion or legal headaches.
Operationally, having a sole point person also makes the most sense because that person understands the objectives and strategies being employed by the company. He or she can communicate the company’s reasons and have succinct talking points when communicating MAP policy violations. A single source also keeps communication and tracking organized. In reality, anyone administrating MAPP should never have conversations unless those conversations are limited to, “Yes, we have MAPP. Yes, you are violating our policy. Yes, you are suspended.” They cannot make deals, or do anything that could be construed as negotiating.
Director of Sales
Depending on the size of the company, someone representing sales needs to know which accounts are being, or are at risk of being, suspended for policy non-compliance.
In some companies, when non-compliant sellers are faced with termination, the Director of Sales needs to make the final call. Maybe, due to the relationship, even a personal phone call from upper management on the final warning would be warranted, rather than an email. The Director of Sales should also make sure to inform all internal sales people and/or independent sales reps about which accounts have been suspended. Because if they’re suspended, they shouldn’t be solicited as clients until the suspension period is over.
Not only will this internal communication reduce friction, in certain cases, the acceptance of purchase orders is considered legally binding contracts. We recommend that brands check with their attorneys.
If the company works with wholesale distributors, then an internal sales person should distribute Do-Not-Ship lists and be available to confirm and explain why accounts were cut off. Having a stakeholder from the sales team involved is also important so that the suspended reseller(s) aren’t approached to get orders. If they’re suspended then they shouldn’t be solicited as clients until the suspension period is over.
Bookkeeper or Accounts Receivable Respresentative
Sometimes purchase orders aren’t deemed “accepted” until an invoice or packing slip is created. It’s important that this is understood. So, if re-orders go directly to the finance department, providing them with a list of suspended customers is vital to catch mistakes.
This is the last stop in the chain. If an order slips past A/R, the shipment can still be held up. Even if the invoice has been created, having the do-not-ship list distributed to the point of outbound orders provides a final safety net where mistakes can be caught. If the order has been deemed “accepted,” best business practices allow for backorders to be created. That can go a long way in avoiding the resupply of suspended resellers.
Depending on how a company is set up, how they set-up new accounts, check credit, etc., there are other stakeholders, but these are the most important ones. If your business is large or small, just follow the trail through the company. That’s the best way to avoid making mistakes with your MAP Policy enforcement.