Price fixing in Japan

Price fixing in Japan

As a final word on pricing, be aware that for many products, price fixing seems to be the rule rather than the exception. For example when I was living in Japan, cans of soda everywhere were priced at ¥100. This was the price at every grocery and every convenience store, and at every vending machine.

After the introduction of a three-percent nationwide sales tax, the after-tax price rose suddenly to ¥110. This new price appeared everywhere, simultaneously.

I'm not saying that this kind of blatant price-fixing is necessarily bad. It may provide for stable employment, and it forces firms to compete on things like service instead of price - and the service in Japan is great.

Still you should be aware of this practice when selling your products in Japan. But even this type of widespread collusion may be ending because of the discounters.

Discounters like Kawachiya and Fujiki Honten have begun to sell loads of cosmetics and liquor at prices below the manufacturer's suggested retail price. Manufacturers like cosmetic maker Shiseido have responded by cutting their supplies to the discounters.

The Fair Trade Commission raided Shiseido's offices and courts have ruled that cutting supplies like this is illegal. Stay tuned for more in this ongoing battle between the manufacturers and discounters.