MSRP – Manufacturer’s Suggested Retail Price

Definition updated on November 2023

What is MSRP (Manufacturer’s Suggested Retail Price) and how does it impact product pricing strategies?

The Manufacturer's Suggested Retail Price (MSRP) is the price that the producer or manufacturer of a product recommends it be sold for in retail stores. This price is often displayed on product tags or labels and serves as a guideline for retailers. In the sneaker industry, the MSRP provides a standard for how much a particular pair of sneakers should typically cost when first released to the public. It's essential for sneaker resellers to understand the MSRP because it can be an initial reference point for determining the sneaker's value in the market. However, the actual selling price can differ based on factors like demand, rarity, collaborations, or regional variations. For example, a sneaker with a high demand and low supply might resell for many times its MSRP shortly after release. Conversely, a sneaker that doesn't capture consumer interest might sell below its MSRP. The MSRP also provides a sense of fairness and transparency, ensuring customers have an idea of the product's "official" price, even if market dynamics push the selling price in different directions. For sneaker resellers, the gap between the MSRP and the reselling price can indicate the sneaker's desirability, potential profitability, and overall market demand. Understanding the MSRP helps resellers make informed decisions about which sneakers to invest in and how to price them in the secondary market.

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