CH 24 Essay example

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Study Guide to accompany Canadian Business and the Law, 5th edition

Chapter 24

CHAPTER 24
SALES AND MARKETING: PRICE,
DISTRIBUTION, AND RISK MANAGEMENT
Objectives
After studying this chapter, you should have an understanding of
• the legal obligations associated with the price component of marketing
• the legal obligations associated with the distribution (place) component of marketing
• the role of ethics, risk management, and corporate compliance in marketing

Learning Outcomes





Understand the purpose of regulation of price in the market (page 600)
Understand prohibited pricing practices (page 600)
Understand prohibited distribution practices (page 607)
Understand the role of ethics, risk management, and corporate compliance in marketing
(page 612)

Chapter Summary
Price and distribution are two of the four components of the marketing mix. Pricing regulation is designed to protect consumers, but there is also strong public interest in ensuring that businesses compete fairly. If unfair practices are permitted, honest businesses will find themselves at a competitive disadvantage or will be squeezed out of the marketplace. While it is perhaps thought that anything goes in competition between businesses, the regulations outlined in this chapter related to business-to-business dealings show that this assumption is incorrect. Businesses may have to become dominant in the marketplace to achieve economies of scale. Nonetheless, such market dominance cannot be allowed to lead to unfair or discriminatory practices. Distribution covers a range of activities and practices. Distribution practices that discriminate between customers and thereby substantially reduce competition are reviewable by the Competition Bureau. Directmarketing practices are regulated both provincially and federally. Risk management in marketing entails paying close attention to all aspects of a marketing plan to identify risks relating to the business and its customers. A plan should set clear guidelines for staff and ensure awareness of marketing activities that are not permitted. A corporate compliance program is a critical factor in any investigation by the Competition Bureau. More importantly, it positions the business so that compliance with all legislation is a fundamental principle by which it operates.

© 2014 Nelson Education Limited

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Study Guide to accompany Canadian Business and the Law, 5th edition

Chapter 24

Study Outline
Use this outline to prepare a complete set of notes for this chapter.
Price—page 600
______________________________________________________________________
Pricing Practices between Producer and Commercial Purchaser ___________________
______________________________________________________________________
Pricing conspiracies __________________________________________________
______________________________________________________________________
Bid rigging _________________________________________________________
Abuse of Dominant Position_______________________________________________
______________________________________________________________________
Price discrimination __________________________________________________
______________________________________________________________________
Predatory pricing_____________________________________________________
Price maintenance ____________________________________________________
Pricing Practices between Seller and Consumer________________________________
______________________________________________________________________
Sale or bargain prices _________________________________________________
Sale above Advertised Prices ______________________________________________
Double ticketing _____________________________________________________
Distribution—page 607
______________________________________________________________________
Multi-level Marketing____________________________________________________
Pyramid selling…