I just received the following email from Powermax. It would have been nice to get a pair of RS-2s for a good price but I guess that wasn't meant to be.
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Dear Friend of PowerMax,
We regret to inform you our relationship with Grado has ended before we were able to ship the product on your order. Accordingly, we will not be able to fill the order you placed with us.
To be frank, since we feel the issue was the result of poor business practices and communication on the part of Grado, we would like to ensure you know what happened and why, as well as make you a special offer of a one-time discount of 10% off any Bose, M-Audio or Shure headphones we carry. While these lines may or may not have some of the same features of the Grado product you were interested, we personally believe that the honorability of a company has a lot to do with the place we want to spend our dollars. We know many of you feel the same, and so we make you this offer out of gratitude of sticking by us over this last month or so, and encourage you to consider the below when making your decision on your next headphones.
Here's the story:
A number of manufacturers engage in a practice involving the setting of "MAP" (Minimum Advertised Price). The concern each manufacturer expresses regarding MAP ranges from making it a "suggestion," to rigid enforcement
by way of de-authorizing those companies who advertise a lower price. (This is sometimes the reason you don't see prices for a product on our site until you put it in the shopping cart, so they aren't "advertised" below MAP).
We aren't always aware to what extreme a particular manufacturer views its MAP policies ahead of time. Since PowerMax always strives to provide competitive prices along with our exemplary customer service, we often sell products below MAP. If a manufacturer is rather militant about its MAP pricing, they'll usually let us know.
Such is the case with Grado. We advertised their line below MAP. They advised us that we needed to sell at MAP or have our shipments suspended. We complied (albeit reluctantly, as we feel this stance is rather anti-competitive). However, most MAP policies allow for a variance to account for resellers styles of pricing. For instance, with PowerMax, we use ".88" quite a bit in our pricing, making it a kind of "signature price." So, in the case of Grado, we set the price at, for example, $94.88 on a $95 MAP. Just a twelve cent variance to align it with our pricing signature.
We were told the President of Grado threw a fit over our pricing structure and decided to "punish" us by suspending shipments for thirty days. Additionally, this was after receiving incorrect information about the shipping status of current orders (we didn't know if they were lying or are just incredibly inefficient). The most disturbing part about this action is that Grado is actually punishing its own customers. With a number of customers with the headphones on order, this thirty day "punishment" only served to deprive their own customers from purchased product, all over a twelve cent issue.
Upon further investigation and communication, we were told the "punishment" was cancelled and shipments would resume. However, that has proven to be a lie.
To be perfectly honest, we find Grado's behavior unprofessional at the least, downright rude for certain. They are a small company that makes some expensive headphones. But when we are given false information, when mutual customers are "punished" over a twelve cent issue, and the company itself is very uncommunicative and inconsistent despite their small size, well, needless to say, we're not exactly thrilled with them as a company. We think there are a lot of other excellent headphones out there, backed by reputable companies who care what their customers and resellers think about them.
As always, we're not afraid to tell our customers exactly what's going on, or what we think. That's what makes PowerMax special!
Thanks again for your patience and understanding. And we apologize for any inconvenience you have suffered. Please don't hesitate to let us know what we can do for you.
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Happy Listening!
