Retailers, consumers and prices
As retailers tried to attract consumers for some post-Labor Day shopping, apparel retailers Aeropostale and Charlotte Russe beat Gap Inc’s Old Navy chain in the pricing war this month, according to Eric Beder, associate director of research for Brean Murray Carret & Co.
While Aeropostale has “never looked better” with its combination of good merchandise and prices, Arden B owner Wet Seal remains the “low price leader,” Beder said.
Consumers have continued to seek lower prices for items like clothes and some surveys have predicted that although they might be willing to open up their wallets a little, they will still favor discounts as they draw up shopping lists ahead of the holiday season.
Another teen retailer Abercrombie, which usually has higher prices, may be realizing that consumers are likely staying cautious spenders and is offering more promotions, Beder said in the research note.
If you want an answer to this question, you aren’t the only one.
Food companies like Kellogg Co, which makes the products mentioned above, say the higher prices are justified because while commodity price inflation has eased amid a global economic downturn, commodity prices remain well above historical averages.