In a letter to retailers sent earlier last week, Skechers USA President Michael Greenberg referenced a letter sent to all retail partners in January in which a $100 per pair minimum resale price for Shape-Ups was established.  The latest letter, dated July 29, notes that the mandatory minimum resale price for Shape-Ups was being set at the minimum resale price reflected on the wholesale line sheets.  He also indicated that the product should be “excluded from all promotions, discounts, ‘buy-one-get-one’s,’ and any other off-price vehicle that would reduce the selling price below the mandatory minimum resale price.”  Skechers will, however, permit “occasional pricing specials” and “set window periods” so retailers can “clear obsolete styles and colors.”

The letter went on to explain the rationale behind the policy and suggested that while Skechers has “traditionally given its retail partners a lot of latitude to set prices on the thousands of Skechers’ products,” they “occasionally” require their partners to “maintain minimum resale prices on some products to protect their integrity and image.”   Greenberg wrote in the letter that if an account chooses to deviate from this policy, Skechers reserves the right to “terminate shipments of Shape-Ups to that account.”  The policy was described as “unilateral and not negotiable” and Skechers will “neither ask nor seek any account’s agreement with it.”

The new get tough policy is expected to maintain some integrity around this growing category, not only for Skechers, but the market as a whole.  Many are hoping Reebok will do the same so a potential golden goose isn’t slain too early in the process.  Stores like Foot Solutions have been able to garner $250 to $300 and up in the category and holding price at half that range seems reasonable to most market watchers.