MAP Policy Mistakes

It’s surprising how often I find articles that are flat out wrong about what a MAP policy is. There are many small mistakes, but there are some much larger and potentially dangerous ones as well.

There is a lot of really bad Minimum Advertised Price (MAP) information out there. Since I am trying to write good information, or at least above average, I thought I would share some of the really bad stuff I’ve seen.

It’s surprising how often I find articles that are flat out wrong about what a MAP policy is. There are many small mistakes, but there are some much larger and potentially dangerous ones as well.

Here are two of the biggest and most common mistakes I see. 

1. People confuse “advertised price” with “sale price.” 

Here is an example from a recent article I read that was supposedly explaining MAP.

“…a shirt manufacturer sets the MAP at $ 47. What does it mean? This means that the seller can sell the same shirt for the same amount or more, not for less.”

Besides being poorly written this is factually incorrect. What it should say is that if the MAP price is $47.00, then sellers are in violation of the policy if they advertise the product for less than $47.00. 

I know this seems nitpicky but it is important.

A MAP policy only applies to advertised price, not sale price, for a reason. The reason is to avoid violating the First Sale Doctrine. 

I am not an attorney and cannot give legal advice, but with six years of experience, let me tell you my non-legal opinion on why this matters. The First Sale Doctrine says that if someone buys a product legally, they can then sell it at whatever price they want. 

Additionally, a manufacturer cannot hinder their ability to sell at whatever price they choose. So, if a manufacturer controls advertising, but allows sellers to sell at whatever price they want, then they are not in violation of the First Sale Doctrine. 

This is why almost all MAP policies have a clause like this:


Hey I get it, we all know the advertised price is the same thing as the selling price on a website. So, is this just some sort of legal loophole?

Manufacturer: “We are not telling you what price to sell for only what price to advertise!” 

Seller: “Well it’s the same damn thing. Leave me alone!”

Maybe it is a loophole, but it benefits the brick-and-mortar dealers.

When you are in your local dealership and are about to buy a pair of awesome Gaerne boots, you might ask the salesman if he can knock a little off the price. If he decides to give you a $50 discount, he is not in violation of the MAP policy because he did not advertise the lower price or the discount. I have to say, anything that gives dealerships an advantage over Amazon is dear to my heart. 

But not only that, it is great for the manufacturers as well. If dealerships have a good profit margin and do not have to compete against third party sellers on Amazon, they are more likely to stock products, and to push one brand over another. This translates into more brand awareness and sales. So the brand, the customer and the manufacturer benefit. 

There are additional advantages to policing “advertising” and not “sale price” as well.

Most MAP policies apply to more than just the advertised “price.” They also apply to other forms of advertising. A policy might state that strikethrough pricing is a violation. In this case a reseller advertising the above shirt for “$48.00” might be in violation of the policy, even though the price is $48 which is above $47, it uses strikethrough pricing which is a violation of the policy. 

Another common example is forbidding phrases like “See price in cart”.  If these words are used it might imply that there is a lower price available in the cart. A MAP policy can prohibit this phrase or perhaps “any wording which implies a lower price is available.”

These options give manufacturers a lot of control on how their product is sold. There are many other nuances and options which I won’t go into here, but your get the idea.

 2. The next big mistake I see is people confusing a Unilateral MAP Policy with an “agreement.”

This can be a big deal. Here is another excerpt from my collection of bad MAP info: “Minimum advertised price (MAP or IMAP) is a contractual arrangement between a manufacturer and a retailer that requires the latter to display a minimum advertised price despite the actual selling price.”

A unilateral policy is most definitely NOT a “contractual arrangement.” Unilateral means that it is just one party, ie the manufacturer. An agreement implies two or more parties and that they have agreed. I see this issue all the time. We send violation notices to dealers every day and frequently one will call me up and say, “We never agreed to this MAP policy, so we do not have to abide by it.”

I then have to explain to them that a unilateral policy is not an agreement and that they actually do have to abide if they do not want to be cut off by the manufacturer. 

This is good for manufacturers as well, because they usually sell to wholesale distributors who in turn sell to hundreds of dealers and e-commerce sellers, which the manufacturer knows nothing about. These are often the third-party sellers on Amazon, etc. If the policy were an agreement, that only applied to the dealers the manufacturer had a relationship with, it would allow the rogue third party sellers to do what they like. The guy sitting around in his underwear with a laptop and a data feed from a wholesale distributor is not someone you want representing your brand! 

There are other ways to limit these “underwear entrepreneurs” with an authorized dealer program, but that is a topic for another article. 

For now, if you hear anyone talk about “sale price” or about an “agreement” when discussing MAP, be very cautious. And if you want to read some examples of good powersport MAP policies you can do so here: MAP Policies.

You May Also Like

NPA Pre-Owned Market Update: April 2024

New and used sales look very similar to 2023.

National Powersport Auctions, NPA, Market Report

The New Normal

As spring nears the end of the runway, dealers continue to report solid retail trends, with some caveats. In speaking with our dealers and reviewing data from dealer management system (DMS) providers and statistical agencies, new and used sales look very similar to 2023. Many dealers reported solid in-dealership foot traffic last month while they spoke candidly about some of their challenges. Increasing costs, adverse interest rate terms and growing inventory levels top the list of many dealers’ concerns. In addition, data suggests longer dealership sales cycles and significant margin compression on both new and used sales versus last year. While the light of spring is quickly fading, April price trends at auction were right in line with our expectations.

NPA Pre-Owned Market Update: March 2024

Used pricing has finally returned to normal levels post-COVID, and normal seasonality has returned.

National Powersport Auctions, NPA, Market Report
Establishing the Right Pay Plan for Your Dealership’s F&I Team

In an industry where skilled F&I professionals are in high demand, an attractive, fair and equitable pay plan becomes a key tool.

Motorcycle dealership F&I
Elevating Your Sales Game Through Parts Packaging

Breaking down the art and science of a well-designed, customer-focused, profit-friendly parts package.

Fostering an F&I Culture That Sells

Dealership success hinges on the ability to cultivate a strong F&I culture.

Other Posts

Arctic Cat Updates Rebate Pricing

Arctic Cat is now offering up to $2,500 in savings on select model year 2022 and 2023 off-road vehicles for the Green Tag Sales Event.

Kawasaki Unveils New Interactive Build & Price Tool

This new interactive tool is available for Ridge and Ridge XR side-by-sides, offering customers to personalize vehicles in real-time.

NYC Norton Is Vintage Racing Paradise

Kenny Cummings, the owner of NYC Norton, doesn’t want his exact location in Jersey City, NJ, disclosed. But, inside, it’s a vintage Norton and racing heaven.

Kenny Cummings NYC Norton
How Dealers Can Manage the Bloat From Growth

There are four things to add to your “beat the bloat checklist.” This advice applies if you run a department or own the dealership.