A minimum advertised price policy says the lowest price at which a stockist may advertise your product. Not the lowest price they may sell it at, which is their decision and generally not yours to make, but the lowest price they may put in an ad, a listing, a shop window or a marketplace title.
For a brand with five stockists, writing one is premature. For a brand with thirty, some of them online, it is the difference between a product that holds its price and a product that has quietly become a discount item everywhere except your own store.
What the policy does and does not control
The distinction is the entire subject, and getting it wrong is how small brands end up with a policy that is unenforceable and a reputation for being difficult.
You may set the price at which you sell to a shop. You may suggest the price at which they sell on. What you generally may not do is dictate their resale price, which is why the mechanism attaches to advertising rather than to selling.
In practice this works better than it sounds. Almost all price erosion happens in public: a marketplace listing, a discount banner, a promotional email. A shop quietly selling a candle a few dollars under your suggested price to a regular customer is not the problem you are solving.
The suggested price itself is upstream of all this and has to be right first. If your stated retail is higher than the market will pay, every stockist will discount and no policy will hold. Setting it is covered in suggested retail price.
When a small brand actually needs one
Four signals, and one is usually enough.
Your product appears on a marketplace you did not authorise. Someone bought cases and listed them below your own store price. This is the most common trigger and the most damaging, because marketplace listings rank in search for your brand name.
A stockist runs deep promotional discounts on your product. A shop clearing stock at a steep cut trains its customers, and anyone who sees the ad, to wait for the next one.
Your own store is being undercut in search. When a customer searching your brand sees a lower price above your own listing, your direct conversion rate drops and your ad spend stops working.
Other stockists start asking about it. A shop that sees a competitor advertising below the level they can match will either match it or stop reordering, and most stop reordering.
If none of those is happening, spend the hour on something else. A policy written in advance for a problem you do not have is one more document to maintain.
What goes in the policy
Keep it to one page and keep it unilateral: it is a policy you publish and apply, not an agreement you negotiate. That distinction matters legally in many places and it also matters practically, because negotiating price floors account by account is exactly the mess you are trying to avoid.
The page should state:
- Which products it covers and the minimum advertised price for each.
- What counts as advertising: websites, marketplaces, search ads, social posts, printed flyers, in-store signage, email promotions.
- What is excluded: the price shown in a cart after a customer adds the item, in-person conversations, and genuine clearance of discontinued items with written permission.
- Permitted promotional language, such as advertising a saving without displaying a price below the floor.
- What happens on a breach: a notice, a period to correct it, and then suspension of the account.
- That the policy applies to everyone, is not negotiable, and that you do not discuss other accounts' compliance.
Set the floor at the suggested retail price itself, or a little below it if you want to leave room for normal seasonal promotion. A floor identical to retail with no flexibility tends to get ignored during holiday sales, and a policy that is ignored at Christmas is not a policy.
Enforcing it at a small brand's scale
The enforcement most brands imagine involves lawyers. The enforcement that works involves a search and an email.
Once a month, search your brand name and your main product names, check the marketplaces where your category sells, and look at the sites of your online stockists. Fifteen minutes.
When you find a breach, the first message is short and neutral: here is the listing, here is the policy, please correct it within five business days. Most breaches are a staff member running a site-wide promotion without thinking about supplier terms, and most are fixed the same week.
When it is not corrected, stop shipping. That is the sanction, it is entirely within your control, and it is why the policy has to be tied to your account approval rules rather than floating on its own. How those rules fit together is in wholesale policy.
Apply it evenly. A policy enforced against a small account and quietly ignored for your largest one stops being a policy the moment anyone notices, and in a small category everyone notices.
The listings you cannot control
Some of the worst price erosion comes from sellers you never sold to: a liquidator who bought a closing shop's stock, a reseller who bought your units at a trade show, an account that went under and sold its inventory.
You cannot enforce a policy against someone who is not your account. What you can do is reduce how much product reaches them, and that is a channel problem rather than a pricing one. The practical measures, including what to write into your account terms about onward selling, are in retail and resale.
The other lever is supply discipline. Brands that are careful about who they open accounts for, and that do not dump surplus stock into clearance channels themselves, have far less of this problem. Most unauthorised listings of a small brand's product started with the brand selling a large quantity to someone who was not really a retailer.
What a policy costs you
Be honest about the downside before writing one.
Some accounts will decline to take you on. Larger online retailers in particular have their own pricing systems and may not want a supplier with a floor.
It creates work: the monthly check, the emails, the occasional uncomfortable conversation with a good account.
And it can be the wrong priority. A brand with eight stockists fighting for shelf space has bigger problems than a shop advertising three dollars under retail. The policy earns its keep when you have enough distribution that the accounts can see each other.
If you are trying to judge whether your category is one where this happens, look at where comparable products already sit. Paste a product link into WholesalePilot and look at the preview of retailers and distributors stocking similar products: a category dominated by marketplace sellers behaves very differently from one sold through independent boutiques. The clause-level version of all of this belongs alongside your other written rules, covered in wholesale terms and conditions.
Questions brands ask about price floors
Is a price floor the same as telling a shop what to charge? No, and the difference is deliberate. The policy governs advertised prices; the selling price stays the retailer's decision.
Should it be in my terms and conditions? Publish it as its own document and reference it from the terms. Keeping it separate and unilateral is the point.
What about a shop that sells under the floor in store? Generally outside the policy and generally not worth chasing. The visible, advertised price is what moves your category.
Do marketplaces respect it? The platform will not enforce it for you, but the seller listing on the platform is usually your account, and your account is who the policy applies to.