Businesses collude to set prices at a level beneficial to them rather than letting the market set the price, which is an illegal form of price fixing.The price can be artificially high.Sometimes the price is so low that a competitor is out of business.The image of price fixing is similar to a few CEOs in a smoky room cutting deals.It is sometimes accurate, but not always.Small and medium sized businesses are often the victims of price fixing because it isn't always top executives doing the colluding.If you have reason to suspect price fixing by competitors or in your company, you can learn how to report it to the authorities.
Step 1: Find out what the same product costs in another region of the country if you suspect that you're paying artificially high prices.
You should check for price differences within the company if the seller is a large company with a national or global reach.Price fixing is practiced by large companies almost always, but it isn't always done by the entire company.The price of concrete blocks in your region will depend on which supplier you go to.This seems high to you, so you call a friend in another state, who tells you that he pays about $1.25.You can find a range of prices, but no higher than $1.39 per block.The same type of concrete blocks should cost the same wherever you go.
Step 2: There are prices that move in tandem.
Even though prices aren't exactly the same at every vendor, price fixing is still happening.Each seller tries to get an advantage over the others.As each one tries to sell for less or deliver more, the sellers' prices should rise and fall at different rates.The prices might rise and fall in tandem with one another, even if they are not exactly the same.The higher end of the soda market is whereAAA Cola caters.They sell a bottle for a dollar.The bottom end of the market is the focus of C+ Cola.The bottle is the same size for $1.The price of a bottle ofAAA has gone up one day.It's $1.25 per bottle when you pick up a bottle of C+ instead.Why is the price of sugar and gas the same as they have always been?It's hard to say, but it is worth investigating.
Step 3: Why were discounts phased out?
It is much easier to eliminate a discount than it is to raise a price.There is less record of it.It seems like a discount is motivated by the seller's generosity rather than a built-in part of the price.A lot of buyers don't ask the sellers why when they go away.Don't be a buyer.Every seller in your area drops the bulk discounts on concrete block.If discounts were a common practice in your industry, and they all suddenly disappear, it can be a way to fix prices without looking like it.
Step 4: Determine the reason for the increase in prices.
A market that behaves abnormal isn't always the result of colluding.There isn't price fixing at work just because prices spike at once.There are many legitimate market forces that cause prices to go up.The cause of a price spike could be anything from a tornado in China to a gas line rupturing in Alabama.Just be alert.Take a closer look at it.It would make sense that the price of cola would go up as both sugar and gasoline are important materials for the manufacture and distribution of the beverage.
Step 5: Keep detailed procurement records.
It is difficult to prove price fixing without the power of a law enforcement agency.A detailed record of transactions can be used to start an investigation if you suspect price fixing.It gives the sort of probable cause that might lead to an investigation.
Step 6: Talk to an attorney.
Private attorneys have experience in white collar crime or antitrust laws.If you are a whistle blower, you should speak with an attorney who protects them.There is a chance that a civil lawsuit could be affected by a criminal case being investigated by the Justice Department.It is possible that you and your co-workers are criminally liable if you are a whistle blower.You should talk to an attorney about your rights.You can find a lawyer who can help through a legal directory.
Step 7: Prepare your complaint.
Prepare your complaint with the assistance of your attorney.You should include the names of companies and individuals you believe to have violated the laws.You should explain how the anti competitive practice hurt the consumer, other competitors and where you fit in.
Step 8: The Antitrust Division of the Department of Justice is where you should submit your complaint.
The antitrust division has three ways to report a complaint.Send your complaint via email to antitrust.complaints@usdoj.gov.You can submit your complaint on the phone.You can mail your complaint to the Antitrust Division of the Citizen Complaint Center.
Step 9: There are companies acting behind the scenes.
Deliberate price fixing is very rare in flashy markets.Innovative markets and innovation give businesses advantages over other businesses, reinforcing the competition in the market.In boring industries, like materials suppliers, price fixing is more common.It would be surprising to find price fixing among some manufacturers.It is not surprising to find price fixing among the mining companies that are mining rare metals.
Step 10: There are companies that produce standardized goods across the industry.
Companies compete against one another when new technologies are being applied in different ways.When the pace of change and innovation slows, offerings in that industry become more similar to one another.It becomes more difficult to gain an advantage over the other companies through competition, so the impulse is to cooperate with them in order for all the parties in the market to make money.The manufacturing products of copper wire, nails, concrete block, and drywall are all standardized across the industry.There is slight variation in the quality of different brands of copper wire, but it is nothing like the difference between the Nintendo DS and the Gizmondo.
Step 11: Be cautious of markets with few players.
Special attention should be paid to markets with a few large players.There is a tendency to collude in such circumstances.When a market consolidates into just a few players, it becomes more and more expensive for one company to best the others through competition, and they can make more money by cooperating with one another.By way of example, the Organization of Petroleum Exporting Countries is an oligopoly that sets limits on the production of oil in order to control the price.Since few countries are oil exporters and no one has the authority to stop them, they gravitate towards price fixing.