Thread: **Update - it worked** Dear Undercutter (ideas for a nice letter to encourage rate raising)

well done, Nyla!

Originally Posted by JimBoz

While I applaud the brass plated ovaries it takes to call someone on their undercutting, we all (or at least those of us who've been in the biz at least 10 years or more...and there's lots with a helluva lot more experience than several times that...not an ageist comment, cuz we all know we started dancing before we were born! LOL) have experienced this and experience it again.

(Snip snip!)

My point is that while I'm the last one to defend biz practices in our industry, the complaints are...unfortunately...absurdly common.

...'gang mentality' in our industry is disturbing, unrealistic and damaging to all of our communities.

That being said, once again I applaud the brass plated ovaries to construct the letter above.

I'm confused. Do you object to the letter she wrote and her attempt to address a situation in a manner that was direct and would protect the recipient from receiving a negative local reputation among her peers without warning/an explanation (which I think PREVENTS some "Mean Girls" behavior)?

Or do you object to her bringing this here to Bhuz and >This thread< is the Mean Girls situation because she talked about what she did and is getting re-enforcing praise?

Or both?

Disclaimer:
I will admit, it can be hard to process objectively any critique that uses that term "Mean Girls" as, as a grown woman, I tend to flinch at a term that reduces a discussion among adults to simplified high school archetypes.

It's a loaded term that shuts down my brain a bit and makes many of us women feel like we are being lumped together as a phenomena and not read for our individual ideas...not unlike if I used the term "mansplaining" in my response to you. It might make you feel like I was judging you as a gender-based noise generator and not for your valid points. It's a small thing... but words do matter.

One thing that I always think about during these kinds of discussions is: how would we feel if it was being done to us? For instance, if we discovered that the local gas companies were sending letters to each other encouraging compliance for a minimum price? As consumers we would be infuriated, and we'd encourage legal investigation. We expect to deal with suppliers one-on-one and to reap the benefits of any economy of cost that the supplier can implement. So when you consider taking on the same role yourself, you might want to consider the legality of what you are doing if nothing else. Unless you are in a union, I'm not sure what your legal defense would be.

Originally Posted by maurazebra

One thing that I always think about during these kinds of discussions is: how would we feel if it was being done to us? For instance, if we discovered that the local gas companies were sending letters to each other encouraging compliance for a minimum price? As consumers we would be infuriated, and we'd encourage legal investigation. We expect to deal with suppliers one-on-one and to reap the benefits of any economy of cost that the supplier can implement. So when you consider taking on the same role yourself, you might want to consider the legality of what you are doing if nothing else. Unless you are in a union, I'm not sure what your legal defense would be.

There IS a legal difference. What you are describing is price setting or even price gouging. However, these are businesses that are being run like businesses - to MAKE A PROFIT. What we are dealing with are people simply don't know that it CAN be a viable business or people who under the guise of a business are seeking ego gratification.
There are no "business and accounting for belly dancers 101" classes- so we help to educate each other. Sharing information, sharing ideas (and facts) about the business - such as looking at ALL your time invested, ALL your money invested etc - is education. It's education that is clearly lacking in some programs.
I thought the OPs letter was nice and clearly held positive intent.
I see this sort of sharing of information as "hey, look at these numbers in time and cost. I think if you look at your numbers etc you'll see something similar in terms of the cost of doing business, which will help SUSTAIN your business. The market supports these in this area and you're worth it." This is assuming the information sharing person is ethical and honest with good intentions. ..g.: (from what I recall Maura, you experienced otherwise)
I don't see anyone saying "Hey, Miss Thang, raise your prices or you're swimming in the Nile."

...it's also a matter of looking out for your fellow dancer and helping her see if an owner may be taking advantage of her. Seriously. I know an owner who pays me $100...and I found out he was paying subs $60 ..c:: Gah! I didn't know! But when I found out I asked him and he was really pushy and told me he wanted me to find subs that would take $60... I said "No. If I find you a sub she needs to get paid the same as a regular dancer here. Otherwise I feel like I'm putting a dancer in an unfair position and I won't do that." Of course I talked about this with the subs. They thanked me for letting them know.
We all do better when we are all successful. We all can invest more in our dance when we charge business sustaining prices (or as close as our local market will bear). Our investing in the dance...buying music, costumes, workshops, travel- THAT $ helps sustain the business OVER THERE. That is supporting the art, the culture and people. I support this!

Originally Posted by SamiraShuruk

I don't see anyone saying "Hey, Miss Thang, raise your prices or you're swimming in the Nile."

Heh. Well, to each their own.

Unions have minimum rates for their workers, and that's not illegal.

Cheers to all the ladies pushing and educating for higher standards. I'm not sure why more dancers aren't on board with this perspective and wish to argue for "argue-sake". Seems counterproductive for everyone.

Originally Posted by Samira_dncr

Unions have minimum rates for their workers, and that's not illegal.

True, it is not illegal. But, even if not a special arrangement sanctioned by law, it is also visible. What folks get annoyed about is what they don't know about, if you follow me. If a dancer belongs to a union or a guild that states minimum rates where the public can get at them, and a dancer states that s/he follows the guild/union guidelines, then folks can hardly get annoyed about a behind-the-scenes agreement about prices... because it is not behind the scene. Of course, they can get annoyed at the idea of a decent wage for dancers period, but that's a different story.

Originally Posted by shadagirl

Cheers to all the ladies pushing and educating for higher standards. I'm not sure why more dancers aren't on board with this perspective and wish to argue for "argue-sake". Seems counterproductive for everyone.

I don't think anyone is arguing with the idea of higher standards or for higher prices. THere's some disagreement about how to accomplish it.

There is a belly dancer in our area (SD), she's charging 40 % ($60) of the standard rate for parties, the same fee for weddings and 50 % for classes.
I emailed her the following. I believe it was non-threatening and professional:
" Hi XXX (deleted name for privacy),

You have a very nice website with a lot of great information about belly dance. I enjoyed looking through it, but I wanted to bring something to you attention.

I noticed that you are available to perform for private parties and weddings for as low as $60 (your website states "starting at $60"). I wanted to let you know that in San Diego the going rate for private parties (20-30 minutes) is a minimum of $150, and some dancers charge more (about $175 - 200). For weddings the going rate is at least $250, often more, depending on the length of performances, if there is zeffa included, etc. Sometimes, only a 10 minute performance is required (belly gram) for which the minimum rate is $125, but $100 at the very least.

If you are offering performances for less than these prices - you are hurting yourself: you are implying that you are just a beginning student, not a professional, and you are not worth the same money as other professionals are getting.
- you are also hurting your entire local belly dancing community. We work very hard to try to keep the rates up. We have been trying to raise them, with very minimal/sad results, so we at least try to keep it at the standard rate I described above. A lot of dancers - including myself - are relying on the income from dancing, and while we welcome fair and friendly competition, we do not tolerate undercutting and unfair prices.
- again, you are also hurting yourself by possibly infuriating other dancers and alienating yourself. We, dancers are friends, and we often refer gigs to each other (sometimes more than 1 dancer is needed, or we cannot make it to a party), and we also refer dancers for regular restaurant work. No one will work with you if they know you are undercutting.

I also wanted to let you know that by offering belly dance classes for $6, you are undercutting, hurting yourself and other teachers, the same way I described above. The going rate for classes are at least $10-12, if the students sign up and prepay for a certain amount of classes (usually at least 1 month) and about $13-15 for drop in.

Based on your videos I believe you are a technically good dancer with great stage presence, having a wonderful website, which shows the qualities of a professional. I am sure you are good person, so that is why I wrote you this email. I am hoping you will think about my suggestions, consider them, and change your prices to reflect the standard rates.

If you have any questions, please do not hesitate to email me or even call me.
Thank you so much,
I look forward to working with you in the future.
Marianna

This is the response I received the next day:
Hello Marianna,

The email below was forwarded to me by XX and I found it necessary to respond and explain the legal severity of your actions. This letter is sent to inform you and not purse legal action against you. Please read the below letter and refrain from continuing the business practices described below or further action will be taken.

Under the Federal Trade Commission, Anti-Trust Laws it is illegal for businesses to act together in ways that can limit competition, lead to higher prices, or hinder another business from entering the market. Price fixing / coercion which is what you are suggesting in this email is illegal under the FTC's rules and regulations. Further, others that work within your immediate network would be an accessory to this crime. These business practices would also fall under an FTC investigation. Keeping markets Competitive and safe is the main focus of the FTC.

Myself and associates are avid supporters of the Federal Trade Commission and work closely with them to ensure all guidelines are adhered to and illegal business practices investigated. Possible action from the FTC under the Sherman Act and Clayton Act can typically result in federal criminal action and penalties up to $100 million for a corporation and $1 million for an individual, along with up to 10 years in prison. What you are suggesting is a violation of the federal anti-trust laws. Further, coerce is also covered under anti-trust laws and state laws which you have also violate in your email.

At this time I am writing to inform you and your email below is in violation of FTC rules and regulation pursuant to price fixing and coercion. In particular to the sections below, you are suggesting the dance instructor raise her prices to meet what you demand is a acceptable price. Further you are using threaten tactics by leading the dance instructor to believe her business may be impacted if she does not follow your suggestions. All are in direct violation of the laws described above. Please refer to your statements below.

Although you may not have intended to violate laws, it is necessary for me to explain why you are receiving this letter. Please take this seriously and refrain from these business practices against the instructor named in this email. A full copy of the email has been retained by myself and further action will be taken in the event future violations are brought to my attention.

Thank you for your time. Sincerely, xx"

Can you believe this?
I forwarded this to 6 belly dancers in this area (including those who are scheduling dancers regularly), and they were as stunned as I am. One is a prosecutor, she said the person is actually misquoting the law, and I have done nothing to violate that law.

I really wasn't worried that this person will sue me, I was just extremely shocked, that this is the response I got.

I'm blown away by this!

Originally Posted by Marianna

...
I forwarded this to 6 belly dancers in this area (including those who are scheduling dancers regularly), and they were as stunned as I am. One is a prosecutor, she said the person is actually misquoting the law, and I have done nothing to violate that law.

I really wasn't worried that this person will sue me, I was just extremely shocked, that this is the response I got.

While she is misquoting the law, it's still important to be REALLY careful how you word things.
Sadly enough most people who are undercutting don't qualify under the FTC- as they are NOT running a business. They are losing money, which (after 3 years) makes it a hobby. If they DID their taxes with all the expenses etc- they'd see how it makes sense to raise their rates and cover the expenses (and time). Discussing covering business expenses is does not fall under coercion- it falls under HELPING them run a business that might be sustainable one day. No one's skipping to the bank with millions... dancers who want to run a successful, sustainable business see what it takes and share the information, so that others may do the same and so that there will be quality dancer/businesses in the future offering their services to the public.

Did the person who wrote the response claim to be an attorney? Apart from the very iffy description of the legal situation, the fake legalese and general usage scream "bogus" to me. Bet she didn't have the nerve to respond on her own, so she or a friend or another colleague invented a higher authority in hopes of scaring you. Nice.

I attached the entire email that was sent to me. In it, the person responding to me disclosed his name (I did not want show it here) and although he did not say that he was her attorney, he implied that he was someone that is connected to her from the business sense.
well, in my opinion he makes it sound like he's her attorney.
It turns out he's her husband :)

Originally Posted by SamiraShuruk

While she is misquoting the law, it's still important to be REALLY careful how you word things.
Sadly enough most people who are undercutting don't qualify under the FTC- as they are NOT running a business. They are losing money, which (after 3 years) makes it a hobby. If they DID their taxes with all the expenses etc- they'd see how it makes sense to raise their rates and cover the expenses (and time). Discussing covering business expenses is does not fall under coercion- it falls under HELPING them run a business that might be sustainable one day. No one's skipping to the bank with millions... dancers who want to run a successful, sustainable business see what it takes and share the information, so that others may do the same and so that there will be quality dancer/businesses in the future offering their services to the public.

Ditto this. Was this person even a lawyer? I don't deal with anti-trust stuff (but I am a lawyer) and even I could tell that this person was full of sh!t. They might be "broadly" referring to FTC regs, but the logistics of anti-trust laws are a whole lot more complicated than just "hey, did you know that the standard prices for this area are $x? You should really get in line with the standards."

That dancer should be blacklisted from any sub/restaurant lists just for being a b!tch. You were trying to help her, and she sends you a letter threatening legal action? Hell no.

Originally Posted by Marianna

I attached the entire email that was sent to me. In it, the person responding to me disclosed his name (I did not want show it here) and although he did not say that he was her attorney, he implied that he was someone that is connected to her from the business sense.
well, in my opinion he makes it sound like he's her attorney.
It turns out he's her husband :)

You should get your prosecutor friend to write a real "letter from a lawyer" putting this guy in his place!

Samira, you're right, it's important to be careful.
I tried to word everything in a friendly yet professional way. I did not want to make her mad, just wanted to open her eyes to reality.

I thought she might send me a letter justifying why she charges so little, and maybe tells me to leave her alone. I did not expect an email like this.
In my opinion, everything is blown out of proportion.

I said "no one will work with her if they know she undercuts"
the "attorney" said: "Further you are using threaten tactics by leading the dance instructor to believe her business may be impacted if she does not follow your suggestions. "
I wasn't threatening her, I didn't say that I will make sure no one will work with her, I was trying to warn her about what might happen.

oh well... she's the one who will loose in the end.
And I do believe we "welcome" friendly competition - it's good for you. It challenges you to become better, not so much as better than others, but to become your personal best. As long as the prices are not lowered, it's also fair competition.

the prosecutor bellydancer did say if the guy contacts me again she would send him a letter.

The reason I forwarded both emails to other dancers in the area is because they are scheduling other dancers, or work with a lot of others, and this way everyone will know. I have never heard of this girl before, but on her website it states she's been dancing professionally for 7 years. Definitely not in San Diego.

From the two examples given in this thread (the original OP never got a response, but the dancer in question raised her rates on the website, and the second dancer's husband sent back a letter warning legal action) I'm thinking that email may not be the best way to communicate these attempts to help other dancers develop maintain sustainable business pricing.

Originally Posted by maurazebra

From the two examples given in this thread (the original OP never got a response, but the dancer in question raised her rates on the website, and the second dancer's husband sent back a letter warning legal action) I'm thinking that email may not be the best way to communicate these attempts to help other dancers develop maintain sustainable business pricing.

E-mail might not be the best medium if you already have a rapport with the dancer in question. But I think it's a perfectly appropriate form of communication if you've never met the offending dancer. Personally, I'm really not sure what I'd think if some random dancer I didn't know invited me out for an innocent cup of coffee and then proceeded to grill me about my business practices.

Regardless of the medium, I think a better approach might be:

1. Save outreach for dancers who will receive it well. (Works better on clueless-yet-benign noobs than your local nutjob).

2. Be nice and complimentary. Instead of "You're screwing us out of gigs," pick "You're a lovely dancer and you deserve to make a LOT more money."

3. Don't expect the dancer to change her ways

Also, if there's a professional association in your area, you may want to coordinate a panel discussion about rates and send invites to everyone, especially those who haven't been caught up to speed.

Originally Posted by Marianna

It turns out he's her husband :)

What sort of husband would encourage his wife to earn less money than she’s worth? It’s like he’s saying that all the real artists make $X/show, but his wife isn’t as good so she should only make $Y/show. How insulting.

Disclaimer: not a lawyer or an economist.

What we commonly call "undercutting" here on the boards is referred to also as "predatory pricing." Predatory pricing is the practice of selling goods or services at a loss with the aim of driving competitors out of business. Then the business has, eventually, a monopoly. So for all that we are talking about illegal price-fixing... undercutting is also a form a price fixing!

And I was going to add: generally price fixing is illegal when a group of competitors makes a secret agreement to charge a minimum rate. So in contacting a dancer, be sure to avoid implying that other dancers have agreed to charge a certain amount. Maybe explain that having calculated your costs for transportation, costumes, practice time, et cetera, you have arrived at a certain rate in order to make a living, and that she might want to examine her costs more closely in determining her own.

Originally Posted by SatinWorship19

Also, if there's a professional association in your area, you may want to coordinate a panel discussion about rates and send invites to everyone, especially those who haven't been caught up to speed.

Big IF, but this...

I like communucating in email, especially if I don't know the person. But also, if there is a difficult situation to address and I do have a rapport with the other person, for me it's easier to do it in writing.
I can really think about what I want to say, reword things, etc. Face to face I might just blurt things out and can't take it back. :)

a while ago (over a year ago) I also sent an email to a dancer whom I knew pretty well, but we're really not friends. She was charging just a bit less than the standard, I think $25 or so. She called it a special, but it was on her website posted for months. I thought it made it harder for us to get the standard.
I emailed her, she emailed me back, she actually justified her reasoning, but then I saw that she changed her price back (or maybe just took it off the website, don't remember).
But there was no anger, name calling, nor legal threats. I thought she handled it very well.

Originally Posted by maurazebra

Big IF, but this...

Yeah, I know. We have a professional association in the Northeast, though to my knowledge, it's been fairly inactive recently.

Another local dancer and I were thinking about coordinating a panel discussion, but we were afraid it would just be us and a few other like-minded dancers preaching to the choir ,r:;

If anybody's pulled this type of round-table discussion off successfully, I'd love to hear some case studies. Maybe I might want to revisit this....

Originally Posted by tigerb

What we commonly call "undercutting" here on the boards is referred to also as "predatory pricing." Predatory pricing is the practice of selling goods or services at a loss with the aim of driving competitors out of business. Then the business has, eventually, a monopoly. So for all that we are talking about illegal price-fixing... undercutting is also a form a price fixing!

Undercutting also feels extremely shady in recessionary times, where it is very likely that many of your competitors/colleagues may have experienced a dramatic change in their employment situation. Think about it: close to 10% of the nation is unemployed and experts estimate that over 20% are under-employed, having been forced to take part-time jobs or positions below their qualifications just to make ends meet.

Price gouging hurts freelancers who are turning to their dance income because they became unemployed or underemployed, experienced a pay cut, have a laid-off spouse. (Not to mention, those who have been full-time dancers since before the recession!)

Hey, I'm always happy to lose gigs to more experienced, talented dancers than myself, because it's nice to see that customers are paying for quality entertainment - whether it's me or somebody else! Thankfully, I've almost completely gotten around price competition by marketing myself to a different crowd....but that doesn't make undercutting any less frustrating of an issue at large. If a potential corporate or bridal client goes to a restaurant or turns on the TV and sees something astoundingly sleazy, that might affect their impression of what *I* do, and they might opt for the string quartet instead. ,r:;

RE: "to name Jo. or not in the letter"

Originally Posted by crystalllized

"If I had to send that letter to a dancer new to the Sac area, I would definitely not have included the last part.

The person who I sent this letter to was a former student of Jodette's and therefor had learned her business practices, which was reflected by her website posting the undercutting prices. It is also assumed that when someone leaves her camp it is from some altercation, because once out, you are a traitor and can't go back. I was trying to appeal to her sense of justice, but maybe went overboard without the harshness of the statement?

I felt that without the last part, the letter was weaker and that she might have just ignored me because she was trained to do things a different way. Yes, community baggage got in the way, but I wanted her to know that the way her teacher conducted business was not standard and that she could join the "rest of the community" in working for better conditions.
So I guess the question I have now is how do I word all of that, but not pick on someone?
I am sure this issue is going to come up again and I want to finish my template and distribute it to the other Sac girls.
So one would be specifically for former students of J.
The other would be the same as above, but with no mention of J.
Or just the same letter to everyone with no mention of J?
I just feel that by not mentioning the elephant in the room to her former students, the influence of the letter is somewhat diminished.

*I do see what you mean about the elephant in the room! But...for me, I think I would still leave off the name.
Perhaps add..."Please feel free to discuss this with me" at the end ?
Or is that not such a good idea? too wishy-washy?
And the discussion within this thread re: price fixing, racketeering, monopolies: taking a deep profit loss as a business to drive out all competition, which is what Wal-mart does, is coming under more & more legal scrutiny.
To reflect that the OP letter intent is akin to illegality of forced monopoly is a premature conclusion.
I believe that doing so does stretch the intent of anti- monopoly laws. Additionally, let's not forget the early 20th century union wars which were initially started to protect workers from the prevailing harsh, unfair, inhumane labor laws. People were killed in their fight for workers' rights. I am a descendant of those so I admit it is a loaded topic for me.
And, I am deliberately leaving the CURRENT state of unions OUT of my example.

Originally Posted by tigerb

And I was going to add: generally price fixing is illegal when a group of competitors makes a secret agreement to charge a minimum rate. So in contacting a dancer, be sure to avoid implying that other dancers have agreed to charge a certain amount. Maybe explain that having calculated your costs for transportation, costumes, practice time, et cetera, you have arrived at a certain rate in order to make a living, and that she might want to examine her costs more closely in determining her own.

This is a good idea.