Should retailers take prices higher?

November 10 2021 by Tom Ryan for Retail Wire

A survey of top retail executives finds 59 percent planning to pass on the costs of supply chain disruptions to consumers. Thirty-six percent were planning to absorb the hit and keep prices consistent.

The survey of 51 senior-level executives fielded in October 2021 by First Insight in partnership with the Baker Retailing Center at The Wharton School found 68 percent expecting a margin hit of less than a 10 percent, but 27 percent saw a reduction of 10 to 20 percent, and five percent, more than 30 percent.

Overall, 65 percent of respondents indicated they were changing their pricing in response to inflation.

Asked how they are deciding where and how much to increase pricing, the top responses were:

  • Cost-based pricing/passing along the cost increases, 33 percent; 
  • Leveraging market data, 25 percent; 
  • Eliminating or reducing planned promotions, 22 percent; 
  • Voice-of-customer data/consumer feedback, 20 percent.

The survey comes as vendors on third-quarter analyst calls expressed optimism that surgically raising prices would support their margins while maintaining value across their brands.

Read the Full Article at Retail Wire

pricing  retail pricing  holiday  online survey  supply chain challenges  supply chain  Senior Retail Executives  Holiday Shopping  Holiday Season  supply chain disruption  inflation

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