Apparel retailers masking price increases

A New York Times article (23 April 2011) describes attempts by retailers to carefully choose price increases by type of apparel in an effort to manage the impact of cost increases.  Some of the strategies listed include changing from 50 c endings to 95 c endings or adjusting the price of flipflops by $1 at The Children’s Place,increasing the prices of men’s shirts at Ralph Lauren by $ 6, choosing the price adjustments of socks and T-shirts at American Eagle etc.  Retailers want to recover costs while not shocking customers into cutting back purchases.  Will such selective price adjustments cover up overall price increases and maintain sales ? Will such a strategy increase the price burden on unique apparel offerings and thus, ultimately, increase the risk in the apparel industry ?

About aviyer2010

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