It's funny how almost one hundred years after the Phoebus cartel[0], Philips is still participating in anti-competitive behavior. Apparently the invisible hand of the market is not so well suited after all.
What is controversial is whether this is something that should be allowed, not whether it is anti-competitive.
The question should be if the outcome of this is or is not beneficial to the end consumer.
Manufacturers have an incentive to keep their prices as close to their MSRP as possible and there aren’t many ways of doing that that are not anti-competitive on paper.
However I don’t think that a reseller in London should be able to offer a bette deal than a reseller in say New Castle or Leeds because they are bigger.
While I agree a suburban / rural / remote customer shouldn't necessarily have to pay more, how do we reconcile this with the idea of economies of scale?
If a larger retailer moves more units and can negotiate a better price from the supplier shouldn't they be able to pass (some of) that saving on to the retail customer?
I thought this is, at least one reason, why franchises existed, so retailers can take advantage of bulk purchasing power?
Franchises are a licensing arrangement. You mean chain stores.
No they shouldn't. A competitive market would continuously drive those margins lower. To the extent that a company is able to maintain or freeze margins it means they have too much market power. I'd prefer to break them up but in lieu of that we might as well just pass a law that mandates what a competitive market would do anyways: remove any negotiating power the company had.
Looking back at the history of the electrical / electronic / computer markets it seems that they have been encumbered by patents, trade secrets, trademarks, copyrights and other intellectual property, going right back to Edison.
It wasn’t markets that writ these monopolies into law, it was governments. Is it surprising that these legally granted powers would be exploited and abused?
https://www.reuters.com/article/us-eu-cartel-crt/eu-imposes-...
https://de.reuters.com/article/uk-eu-court-semiconductors/ph...
In a free economy, a monopoly can be contrary to this idea, as it can result in a suboptimal state for society, as if there were no overall-optimizing invisible hand.