Shortages will ALWAYS lead to higher prices. It's one way that a Capital based economic system limits sales volumes. In addition efforts to maintain stock on items like Eggs will lead some grocers to seek out supply from sources outside their "normal" supply chain and that will drive up costs and thus prices. So, yeah we may see prices on eggs go up by 50% or more. Because what may be available now is LOCAL Organic eggs from field fed chickens.

Any time a retailer is forced to go to alternate suppliers an increase in purchasing costs is to be expected. Because any good retailer will refine his supply base to the most economic sources.

BTW, shelf prices are ALWAYS based on the expected re-supply cost, not the purchase price. Because doing any different will simply lead to that store going out of business. Because if you don't sell the product on hand for the replacement cost you will have a NEGATIVE Cash Turnover for that particular sale and long term that only leads to Bankruptcy.

Here is a real simple example of what goes on. You have a box of 9mm ammo that you paid 10 dollars for sitting on your shelf. Now, you have been told that your distributor is 100% cleaned out and won't have stock for 2 months. You checked around and found another distributor that wants 15 bucks for a box that same 9mm ammo. So, what do you do, sell that box on your shelf for 11.50 and lock up and go home for 2 months with an empty shelf? Or do you sell that box for 16.50 knowing you'll have another box to fill that empty space the in 2 or 3 days? Now expand that transaction by an entire store. You'll come to understand why items will always have a price reflecting the replacement cost.

quote:

I sell my organic eggs for $3 a dozen.

Shame on you for not beating Walmart's price!

Most people have no idea what it takes to operate a business. They are clueless when it comes to the cost to operate the business, and if a consumer can't buy what they want at the price they want, then somehow they're getting screwed or gouged.

Assume I own a small hand sanitizer store. I turn 100% of my product on a weekly basis. I get a new order on Monday, and am sold out Sunday evening. My price allows me to pay my company bills, and I make enough profit to pay my personal expenses.

Corona hits. My supplier is hit with orders from all of the heavy hitters, and I'm not going to get my next shipment for 90 days due to the new demand. I have one week's worth of product on the shelf.

Do I A) continue selling for the same price, run out of inventory, and go out of business? B) mark up what I do have so that I can survive the 90 days? Or maybe C) buy product that I can get at an increased cost, but that will require me to raise my prices?

Seems that most of you guys are short sighted enough to choose A.

quote:

Originally posted by 08 Cayenne:

I have not been to the store in a couple weeks but the last time I was at our local grocery, that I have shopped at for 45 years, they had 10 lb bags of potatoes for $8.99, and ground chuck at $8.99 per pound. I didn't report them, plenty others did though, but I lit up the store manager at the checkout.

What store?

All of our kids and grandkids are in Ohio, so this is a pertinent question. I would like to let them know what store to avoid.

Gas prices have fallen 25% or more. Are we (consumer of gas) "reverse price gouging" the gas stations / oil companies?

Riesbecks

quote:

Originally posted by V-Tail:

quote:

Originally posted by 08 Cayenne:

I have not been to the store in a couple weeks but the last time I was at our local grocery, that I have shopped at for 45 years, they had 10 lb bags of potatoes for $8.99, and ground chuck at $8.99 per pound. I didn't report them, plenty others did though, but I lit up the store manager at the checkout.

What store?

All of our kids and grandkids are in Ohio, so this is a pertinent question. I would like to let them know what store to avoid.

Payback

quote:

Originally posted by MagnumU:
Gas prices have fallen 25% or more. Are we (consumer of gas) "reverse price gouging" the gas stations / oil companies?

quote:

Originally posted by a1abdj:

quote:

I sell my organic eggs for $3 a dozen.

Shame on you for not beating Walmart's price!

Most people have no idea what it takes to operate a business. They are clueless when it comes to the cost to operate the business, and if a consumer can't buy what they want at the price they want, then somehow they're getting screwed or gouged.

Assume I own a small hand sanitizer store. I turn 100% of my product on a weekly basis. I get a new order on Monday, and am sold out Sunday evening. My price allows me to pay my company bills, and I make enough profit to pay my personal expenses.

Corona hits. My supplier is hit with orders from all of the heavy hitters, and I'm not going to get my next shipment for 90 days due to the new demand. I have one week's worth of product on the shelf.

Do I A) continue selling for the same price, run out of inventory, and go out of business? B) mark up what I do have so that I can survive the 90 days? Or maybe C) buy product that I can get at an increased cost, but that will require me to raise my prices?

Seems that most of you guys are short sighted enough to choose A.

Ok. Since all of us here are obviously less intelligent than you, at what point and what percentage increase does price gouging occur to you?

quote:

Originally posted by a1abdj:

quote:

I sell my organic eggs for $3 a dozen.

Shame on you for not beating Walmart's price!

Most people have no idea what it takes to operate a business. They are clueless when it comes to the cost to operate the business, and if a consumer can't buy what they want at the price they want, then somehow they're getting screwed or gouged.

Assume I own a small hand sanitizer store. I turn 100% of my product on a weekly basis. I get a new order on Monday, and am sold out Sunday evening. My price allows me to pay my company bills, and I make enough profit to pay my personal expenses.

Corona hits. My supplier is hit with orders from all of the heavy hitters, and I'm not going to get my next shipment for 90 days due to the new demand. I have one week's worth of product on the shelf.

Do I A) continue selling for the same price, run out of inventory, and go out of business? B) mark up what I do have so that I can survive the 90 days? Or maybe C) buy product that I can get at an increased cost, but that will require me to raise my prices?

Seems that most of you guys are short sighted enough to choose A.

Excellent explanation, sadly most wouldn't understand it if we spent 100 years explaining it to them.

I was in Walmart yesterday, I know I know....but that's where I get my dog's insulin. Everywhere else wants three times the cost or won't sell it without a prescription.

Anyway, since I was already there I figured that I would pick up some stuff that I was low on. For the most part the prices were what they were before the craziness. The stock on most things were better than they have been, most shelves were full.

Unlike a couple weeks ago, they had a milk case full of milk. There were eggs, but it wasn't full. Meay case was fairly full. In all, most was back to almost normal, except the toilet paper. None to be seen. They did have some paper towels. No rubbing alcohol or hand sanitizer. But mostly normal.

Three days before I was in Kroger, and it wasn't as full. The meat case was fairly full, no eggs, milk case mostly full. Almost no canned food, soup shelves almost empty.

Looks like Walmart is doing better at getting things in and on the shelves. But I didn't see any markup in prices at either place. At least anything that I normally get.

The price for regular gasoline was $1.69 a gallon
I don't know what premium costs as I didn't stop as I was full. Last time I filled up regular gasoline was $1.79 and premium was $0.60 more at $2.39

I have taken advantage of the cheaper gasoline price and taken the pup bye-bye a few times. As she loves car rides.

ARman

quote:

Ok. Since all of us here are less intelligent than you, at what point and what percentage increase does price gouging occur to you?

Not having any idea how a business operates or what is involved doesn't make a person less intelligent. It simply makes them ignorant.

I say there is no such thing as price gouging. Person A should be able to offer for sale whatever they own for whatever price they wish. Person B should be able to decide whether or not they want to pay Person A's price. It is not Person A's responsibility to subject themselves to the whims of Person B.

You didn't need a gallon of hand sanitizer a month ago. Why is it the retailer's duty to make sure it's available, and at whatever price you demand it for today?

quote:

Originally posted by PowerSurge:

quote:

Originally posted by a1abdj:

quote:

I sell my organic eggs for $3 a dozen.

Shame on you for not beating Walmart's price!

Most people have no idea what it takes to operate a business. They are clueless when it comes to the cost to operate the business, and if a consumer can't buy what they want at the price they want, then somehow they're getting screwed or gouged.

Assume I own a small hand sanitizer store. I turn 100% of my product on a weekly basis. I get a new order on Monday, and am sold out Sunday evening. My price allows me to pay my company bills, and I make enough profit to pay my personal expenses.

Corona hits. My supplier is hit with orders from all of the heavy hitters, and I'm not going to get my next shipment for 90 days due to the new demand. I have one week's worth of product on the shelf.

Do I A) continue selling for the same price, run out of inventory, and go out of business? B) mark up what I do have so that I can survive the 90 days? Or maybe C) buy product that I can get at an increased cost, but that will require me to raise my prices?

Seems that most of you guys are short sighted enough to choose A.

Ok. Since all of us here are obviously less intelligent than you, at what point and what percentage increase does price gouging occur to you?

I know you were not asking me, but for me there is no limit. Supply and demand. In his example I do both B and C. Option A leaves business open for one week with no option but to close the doors, this allows no one to get any profit or any product.

If I can go route C and find the product at double the price, I am not going to sell it at a loss, so I triple my previous price. The store stays open, new product is bought to market that normally wouldn't be, and those that can afford it get the product they need. Weeks later when supplies become more regular the price can be incrementally be lowered back to equilibrium with supply and demand. The store survives, initially only the affluent can get product, but over time everyone can get the product when that new equilibrium is reached and prices return to 'normal'.

This also aids in keeping people from hoarding. If you have a pallet of hand sanitizer purchased at normal price and your only option to buy some is at 3x original cost, you might say I have enough I'll leave the over priced stuff for others. Or you may say I have a pallet of this stuff, I am obviously not going to use it all, I can sell excess at 2.9x the normal price and take business from the sanitizer store. The sanitizer store then reacts by lowering the price to 2.8x the normal price and shares the market with the hoarder.

Our market is self regulating, price discrepancies and arbitrage are quickly fixed by entrepreneurs and investors. Some people will never shop at the sanitizer shop any more because they incorrectly perceived the pricing as gouging and others will thank the store owner for staying open and being able to supply what he could supply in a time of need, even if it was at a higher price and limited bottles to one per customer.

quote:

Originally posted by PowerSurge:

Ok. Since all of us here are obviously less intelligent than you, at what point and what percentage increase does price gouging occur to you?

Third. There is no such thing as price gouging.

quote:

Originally posted by a1abdj:
I say there is no such thing as price gouging. Person A should be able to offer for sale whatever they own for whatever price they wish. Person B should be able to decide whether or not they want to pay Person A's price. It is not Person A's responsibility to subject themselves to the whims of Person B.

Yes.
The price is whatever a willing seller and a willing buyer agree upon. That's the beauty of capitalism, or a market economy. No one participates by force. It's completely voluntary.

It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.
-- Adam Smith

I sell shit at a fair market value and anyone who doesn't like my prices is free to look elsewhere.
This is how a free market works.

I have asked this in threads regarding gay couples suing businesses for not baking them cakes, but I wonder if it applies here too.

If a gay person can force a business to provide goods or services, why can a business not force gays to patronize them?

Or in this case, if you can force a business to sell you an item at whatever price you feel is fair, can a business then force you to purchase an item that they wish to sell at a price they feel is fair?

quote:

Originally posted by chellim1:

quote:

What ever happened to the 'Christian thing to do'?

The 'Christian thing' is voluntary and laudable. But we are not talking about charity here, we're talking about keeping the shelves stocked.
Price discovery moves products to where they are most in demand.

Silly guy. Actually arguing for a free market. What are you, some kind of capitalist or something? Don’t you know that the solution to everything is not freedom, but more government?

ETA: Nobody is holding a gun to any consumer’s head to force them to buy at any inflated price. The consumer is free to say, “FU Lower Than Dirt! I am not buying from you now and I will remember what a no good bags of johnsons you were in these bad times and never buy from you again.” If the retailer is too egregious, consumers can abandon his business and close him down. Of course, the consumer is also free to decide, “Thank goodness for this jerk’s high prices! If he wasn’t a scummy price gouger he’d be out of stock just like everyone else and I wouldn’t be able to get what I need.”

Thankfully, here in our little town Costco put two per customer limits on water and TP and things stabilized relatively quickly. Last time I went (a week or so ago) they had lines setup for getting in with people distancing in line. They had masses of carts waiting at the front door that one guy sprayed with a backpack sprayer of alcohol and two other guys wiped down prior to giving them to the next person in line. Walking in the door, a nice personable young lady asked if you needed paper products and sent you to the left directly through where the camera/picture printing area was/is. There were rows of pallets along the wall. The gentleman there leaning against the front pallet of Charmin said, “Today we have Charmin and Kirkland.” If you said Charmin please, he grabbed a pack and slid it under the basket of your cart and you were on your way.

Trader Joe’s was totally bombed out a couple weeks ago in the afternoon. The meat section was empty, the chip aisle was empty, and they were taking advantage of the fact that the freezer aisle was almost completely empty to clean those cases. A day or two later they had a limit of two of each item per customer. Supply caught up quickly and three or four days later the limit sign was replaced with, “The limits are gone. Please take only what you need to leave some for your neighbors. Thanks for helping our community.” or something much like that. Things have been stable since.

After the initial panic folks seem to have settled down here.

quote:

Originally posted by a1abdj:

quote:

Ok. Since all of us here are less intelligent than you, at what point and what percentage increase does price gouging occur to you?

Not having any idea how a business operates or what is involved doesn't make a person less intelligent. It simply makes them ignorant.

I say there is no such thing as price gouging. Person A should be able to offer for sale whatever they own for whatever price they wish. Person B should be able to decide whether or not they want to pay Person A's price. It is not Person A's responsibility to subject themselves to the whims of Person B.

You didn't need a gallon of hand sanitizer a month ago. Why is it the retailer's duty to make sure it's available, and at whatever price you demand it for today?

I completely understand the economics of it, having read books by Mises, Rothbard and others. But I do not blindly agree with everything they wrote. If you don’t see charging someone 30 dollars for a small bottle of sanitizer during a national emergency that was normally 2 or 3 dollars as price gouging, you really should stop complaining in other threads about places like amazon and “buying local”. You can’t have it both ways.

quote:

If you don’t see charging someone 30 dollars for a small bottle of sanitizer during a national emergency that was normally 2 or 3 dollars as price gouging

I'm pretty sure you don't need hand sanitizer to survive. Perhaps he doesn't really want to sell it. Just because he's asking $30 doesn't mean a single person paid him $30. And if they did, that's on them for not being prepared, and/or being an idiot.

quote:

you really should stop complaining in other threads about places like amazon and “buying local”. You can’t have it both ways.

I'm not the one having it both ways, that would be you. You want the local guy to be there when it suits your interest, but screw him otherwise. I said it in another thread. If I was a local business selling TP, sanitizer, and other "essential items", I would limit my inventory to known local customers. You don't usually shop here? I'm sure Amazon will be happy to help.

Saw this the other day. I'm sure whatever they are selling is way above the 'normal' price, but they are providing stuff you can't currently buy. If they make a killing off of it, how does that diminish the fact that there is more supply than if they didn't sell it at all, or if they sold out in two days?

Good for them bringing in product from wherever they sourced it from and making it available. The more that buy from him, the less will need it when the trucks roll in at the grocery store.



I was tempted to stop by and see what they had.

Edit, just googled it, it's a restaurant supply store. Might stop by and see what they have.

quote:

Originally posted by a1abdj:

quote:

If you don’t see charging someone 30 dollars for a small bottle of sanitizer during a national emergency that was normally 2 or 3 dollars as price gouging

I'm pretty sure you don't need hand sanitizer to survive. Perhaps he doesn't really want to sell it. Just because he's asking $30 doesn't mean a single person paid him $30. And if they did, that's on them for not being prepared, and/or being an idiot.

quote:

you really should stop complaining in other threads about places like amazon and “buying local”. You can’t have it both ways.

I'm not the one having it both ways, that would be you. You want the local guy to be there when it suits your interest, but screw him otherwise. I said it in another thread. If I was a local business selling TP, sanitizer, and other "essential items", I would limit my inventory to known local customers. You don't usually shop here? I'm sure Amazon will be happy to help.

One could absolutely make the argument that you do need a product like hand sanitizer to survive (elderly, those with weakened immune systems,etc).

Like it or not, places like Amazon putting local businesses out of business, that’s just market forces working as Ludwig von Mises stated in Human Action.