Greed rules the shopping malls before Christmas
From: VIJAY SURUJPAL Phoenix WITH Christmas a thing of the past, it’s important to reflect on the prices of items you purchased.
Fundamentally it is a case of goods being marked higher to generate the maximum amount of profit. Have shops now become the milking cows of the hard working consumer? Why do prices go through the ceiling during Christmas? Could the bonuses received by workers be a catalyst to the exorbitant mark-ups during this period?
Why can’t prices remain the same as a token of appreciation for the patronage of the consumer? The concept of demand and supply is a relevant explanation in this context. However, could this economic phenomenon be used as a reason to extract the maximum amount of cash from consumers?
The day after Christmas is the beginning of many sales in most of the major chain stores where goods from clothes to toys to Christmas decor are reduced by as much as 60percent and even more.
The simple explanation for these markdowns is that the goods will lie on the shelves because consumers have spent their money. It makes economic sense to get rid of Christmas stock by creating a demand for those who have budgeted for the anticipated lower prices. At the same time it’s also depressing to walk past a store to see the shirt or dress you paid R700 for before Christmas now being reduced by 50percent or more.
The bottom line is that companies use the euphoria and festivities of Christmas as a marketing tool to extract the most amount of money from consumers. It’s up to the consumer to reflect on the prices and ask themselves if it’s really worth it. Ultimately, the power to bring down prices lies in the hands of consumers. Spontaneous and impulsive buying, especially on credit, is not the answer. Selective purchases based on needs should be a motivating criteria when swiping that credit card.
Wishing everybody a happy holiday. All the best for 2017.