The policy dictates the lowest price a retailer can publicly display for a specific product on the Amazon platform. For instance, if a manufacturer sets a baseline cost for an item, retailers must advertise it at or above that designated price point. This helps control price erosion and maintain brand value across the marketplace.
This strategy offers several advantages. It safeguards a brand’s image, prevents destructive price wars between sellers, and helps ensure consistent profitability for both the manufacturer and the retailer. Historically, this type of policy has helped stabilize markets and prevent unfair competition based solely on aggressive discounting.
