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KONICA MINOLTA’S PRICING TRICKS
by Kim Vinh Luong
At the Printing shop of Saigon Fahasa Co, Ltd (Saigonbook) - 474 Nguyen Thi Minh Khai Street, district 3, Ho Chi Minh City, Vietnam - are placed two Konica Minolta Bizhub Press C1100 that have a price difference of about $98,470 – an amazing amount for anybody who knows this story.
Saigonbook bought the first C1100 from Sao Nam Co., Ltd at a price of $158,423 and the second C1100 from STS Co., Ltd at a price of $59,953. The special thing is that both were distributed by the same distributor - Konica Minolta Business Solutions Viet Nam Co. (KMV); Sao Nam Co. and STS Co. are just commercial agents. In order to trick Saigonbook out of such a large amount of money, KMV used sophisticated tricks that were built into pricing and sales policy.
Firstly, KMV hasn’t made public its sales prices. On the website konicaminolta.com.vn, Konica Minolta products are all displayed without their sales prices. KMV is a company with 100% foreign-invested capital that has the right to make direct sales business in the Vietnamese market. However, they rarely sell products directly to customers. KMV appoints its commercial agents and sales collaborators to sell Konica Minolta products in Viet Nam, using a secret price policy. KMV’s commercial agents and salesmen look for easy prey, the target customers, to induce them to buy Konica Minolta products. When customers request price quotes for products, KMV and its commercial agents will carefully collect information about the customers and then charge them different prices based on their personal and financial information (such as their status, their income, their willingness to pay, etc.). At the same time, their quotations for the same product can have the price difference up to hundreds of thousands of dollars
Making a comparison of 8 quotations for the bizhub Press C1100 provided by KMV and their commercial agents (Sao Nam, STS and Sao Nam An), we were amazed by the difference in price as follows: KMV quoted a price of $153,488 and $102,325; Sao Nam quoted a price of $180,139 and $93,023; STS quoted a price of $79,069 and $83,720 and $ 88,372; Sao Nam An quoted a price of $180,140.
With all the evidence above, KMV and its commercial agents were clearly in breach of Article 6 and Article 12 of the Law on Prices by not publicly displaying the prices of their products and providing different quotations for the same product in order to cheat customers out of money.
KMV is a sales subsidiary of Konica Minolta Business Solutions Asia PTE Ltd, a regional head office of Konica Minolta, Inc., Japan. Therefore, KMV has lots of business experience as well as experienced lawyers that help it evade legal liability. In any case, Vietnamese businesses are always the ones who suffer financial loss that can lead them into debt. When a commercial dispute arises, Vietnamese companies are always engaged in a bitter struggle with each other over commercial contracts; while KMV transfers funds to the holding company and publicly announces that KMV has no contract dispute!
In trade, however, goodwill and honesty are moral principles that are respected and set out in Article 6 of Vietnam Civil Code. KMV is the principal that has rights and duties prescribed in Articles 172 and 173 of Vietnam Commercial Law. For this reason, KMV has responsibility for providing an answer to the public and the press about the price difference between the quotations provided by KMV and its commercial agents. (Note: $1 = VND 21.500).
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