Advertising by manufacturer planning to make both wholesale and direct mail sales

No. 32. Advertising by manufacturer planning to make both wholesale and direct mail sales.

The Federal Trade Commission has made public an advisory opinion on whether a supplier selling by direct mail, to a retail chain and to individual retailers, all of whom are located 10 or more miles from any chain outlet, may properly feature only his own direct mail operations and his chain customer in his national advertising.

The applicant specifica1ly queried as to whether or not the 10 miles or more distance between the individual retailers and the chain outlets negates the possibility of competition between them. As a general rule " the Commission said a supplier s ordinary unilateral advertising expenditures are not subject to the Clayton Act, as amended by the Robinson-Patman Act. In consequence a supplier s advertising which makes clear the direct mail availability of a particular item through the supplier, without more would raise no questions under the Act.

Whether or not the chain outlets and the other retai1ers supplied are competitive, however, is a matter of fact to be determined by the facts. A particular distance between them is not determinative of whether they do or do not compete. If they in fact compete then under the statute the advantages to be accrued from the supplier s advertising program, if accorded at all, must ,

be proportiona1ly accorded. If they do not in fact compete, then otherwise, Under the circumstances, the Commission concluded it is not practicable" to answer that part of the applicant's question dealing with mention of chain store availability in his nationa1 advertising. (Fi1e No. 633 7008, released Apr. 15, 1966.