At least in Australia Festo and their local agents HAVE been successfully prosecuted for price fixing, and fined several hundred thousand dollars. Unfortunately this conviction & fine seems to have had no effect on Festo retail pricing.
In the US Festo prices are relatively much lower than in Australia or even in Germany - a replacement battery that sells for $75US cost around $250US in Australia, and according to a number of US suppliers Festo have now advised their US retailers that anyone selling & shipping ANY Festo products outside the US will be 'terminated'.
Not in the US you aren't. We don't use "imperial gallons" nor do we charge by the "liter". And the Sherman Antitrust Act has absolutely no force whatsoever outside the US. Of course if you really want it to you could try orchstrating a terrrorist attack against us . . .
As far as I can tell, this is the best answer. My (U.S.) company is not allowed to tell resellers what to charge for our products. Once we sell product, it is no longer ours, and the new owner can sell it for whatever they want. Any attempt to tell the new owner what to sell the product for is considered to be anti-competitive. The argument that Festool sells dealer expertise in the price, and uses that as a reason for price fixing the basic tool price is also anticompetitive, since not all buyers will want that service. You can certainly include service in the price of the tool, but you can't use that as an excuse for price fixing. The only way that I can figure out that what Festool is doing is legal is if, as this poster suggests, Festool somehow is maintaining ownership of the tool until it is delivered to the ultimate customer, perhaps with sales incentives or rebates involved. That said, if that is not true, then small dealers without a legal department often cannot prove/resist illegal pressure from suppliers, and in many cases it may not be in their best interest to do so - I'd imagine that dealers do fairly well with Festool sales. If it were in anyone's best interest to pursue the issue, it would be a large seller like Amazon, but their Prime memberships already provide a competitive free shipping, tax-free price, so they may not care either.
Price fixing regulations are designed to protect consumers. Consumers are the ones being harmed by price fixing, and consumers do not have visibility to the negotiations being held between Festool and their dealers, so it is very difficult for a consumer to assert anti-competitive practices. That's why government regulators get involved. Clearly regulators in the U.K and Australia think that Festool is misbehaving, so I would not be surprised to see action in the U.S. at some point. In the long run, it could end up either jacking up Festool prices or reducing the quality, but when Dominos are already selling well for $875 because they are the only tool on the market that does what they do well (I'm not counting biscuit joiners as real competition), there is clearly a business opportunity for other tool companies if they can figure out how to provide a competitive tool that doesn't infringe Festool's patents. If another tool manufacturer sold a tool that performed as well as a Domino at half the cost, with fair quality but perhaps not with the same service or expected life, I'd buy the less expensive tool.
Rule of reason. Looks like you can dictate the price it it is higher than the competition.
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The rule of reason is a legal doctrine used to interpret the Sherman Antitrust Act, one of the cornerstones of United States antitrust law. While some actions like price-fixing are considered illegal per se, other actions, such as possession of a monopoly, must be analyzed under the rule of reason and are only considered illegal when their effect is to unreasonably restrain trade. William Howard Taft, then Chief Judge of the Sixth Circuit Court of Appeals, first developed the doctrine in a ruling on Addyston Pipe and Steel Co. v. United States, which was affirmed in 1899 by the Supreme Court. The doctrine also played a major role in the 1911 Supreme Court case Standard Oil Company of New Jersey v. United States.
Things to consider, first is that most of the dealers have a pretty extensive selection/inventory of the product. That in itself, especially with Festool, is a sizable investment "if" the dealer is actually buying the inventory. FWIW SawStop is the same way and I know for a fact that the industrial model of the SawStop is not stocked for resale by the dealers. In fact you can't buy the industrial model from any other dealer other than the one that covers the area that the saw will be sold and delivered to. There is a chance that both SawStop and Festool sell their products on a consignment type basis. If this is true the fixed pricing is understandable. And if I were a dealer I would not necessarily want my competition selling for less than me. As a consumer I would love to buy Festool at a better price but I can appreciate the fact that I can buy my Festool products from whom I wish and not have to worry about whether I am paying more than somewhere else. I don't have to worry about shopping price.
Concerning your comment about an interest in buying a product that does the same as the Domino at half the price with a "fair" build quality I would say that if you are going to be an occasional user that might be a consideration. But consider this also. The quality of the Domino surpasses any tool in my shop. It performs a function that absolutely needs to be precise and continue to be precise. I bought the Domino assortment initially, emptied the 5mm and 6mm sizes many years ago and have bought a replacement "case" of 6mm and I am running low on my third replacement case of 5mm tenons. There are 1,800 5mm tenons in a case. With that in mind and considering that there are typically two mortises cut for each tenon my Domino has seen over 10,000 plunge cuts. The machine still looks new and cuts like new. There is absolutely no slop anywhere and the mortise locations are still precise. And I am still using the original bits and none have been resharpened.
Now in this example I am not saying that another type tool at a lessor quality would not be a good choice but when you need absolute precision you are going to be better off in the long run going with the Festool Domino. You really don't want a tool that is going to start cutting sloppy mortises.
With regard to fitness of use, you are absolutely right with regard to the Domino. Festool hit a home run with it, both in terms of design and execution, and they deserve to reap the benefits. It's a great tool - everyone who uses it agrees, though not everyone can claim 10,000 cuts (that is seriously impressive)! Maybe I'll get one some day, although I wouldn't use it to it's potential. But if another tool came on the market that did -most- of what a Domino does, and did it accurately, but maybe not as quickly, and would last until my kids took it away because it was too sharp (say 1000 cuts), I'd be OK with that.
Well, I had 2 plate joiners/ biscuit cutters, both PC brand. In about 17 years I cut about 2500 slots. I find that the Domino is so superior that I use it more and more. It really adds strength to joints and better aids alignment. I use it a heck of a lot more than I expected when I bought it. It elegantly solves problems.
What the Domino does is cut a few sizes of mortise, very quickly, easily, and efficiently, without any setup to speak of.
You can get the same _results_ with a shop made jig and a plunge router. The tradeoff is in the time to make the jig and the setup time to use it. If you're making custom cabinets for a living it's easy to justify on the basis of time saved. If you're a hobbyist, a few scraps and some time are a lot cheaper.
I wonder however how many mortises you could cut in a single size with a single bit. For certain my single 5mm bit has cut 8,000 + perfect mortises. When I bought my Domino I knew I would use it but was clueless that I would use it as much as I have. Even as a person that sells 80 percent of my work I do this for fun and certainly my volume does not come near a living, and the time savings has paid for the tool countless times.
My work has increased in quality because I have the Domino. The Domino lets you focus more on designing and building the desired piece vs. doing the same and with complicated jigs. A lot of the type of work that I do with the Domino was not even on the radar when I bought the tool. What I normally would have used a plunge router for with or with our jigs I do with the Domino. Basically what I am saying here is that I value my free time and that the Domino solves more problems than I ever could have imagined without the needs to design and build jigs. I use it in more ways than I imagined when considering the purchase. I think that some of the jigs needed for a plunge router to do the same cuts that I make with the Domino one might need to be more skilled to design and build those jigs than need be to simply make the complicated cuts with a a Domino.
If you're using the same bit that Festool uses you should get the same number unless you manage to break the bit. Nothing magic about a router bit.
Yep, like I said, if you're doing it commercially in volume and getting paid for it, it justifies itself on time saved.
No question once you've got such a tool you find uses for it. But the request was for something with less durability and more limited capability and I was merely pointing out that jigs and a plunge router provide that option.
Well there is nothing about a router bit, but the domino bit is considerable different than a router bit. The whole plunge process probably makes 20 back and forth passes while plunging. The side of the bit past the first 3/16" or so from the tip does no cutting. I used to do a lot of plunge cutting for Steve Knight and typical two wong carbide blades hardly made it past 400 plunges 2" wide. Once I went to an end mill bit I upped that to at least 1,000 cuts.
Agreed but once you actually cut a thousand or so mortises the price of the Domino seems insignificant.
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