Retailers jacked up prices and squeezed consumers. They might have just blinked
CNN
Retailers are feeling jittery. Consumers aren’t shopping like they used to. In a game of chicken between stores and shoppers, it’s the stores that appear to be yielding first, by dropping prices on thousands of products.
Retailers are feeling jittery. Consumers aren’t shopping like they used to. In a game of chicken between stores and shoppers, it’s the stores that appear to be yielding first, by dropping prices on thousands of products. The markdowns come as inflation has pushed prices higher for the past two years, squeezing Americans and forcing them to choose between wants and needs. That’s a problem not just for individual shoppers or even big retail chains but for the whole American economy, of which about two-thirds comes from consumer spending. A slew of retailers in recent weeks have announced price cuts as they strive to pull consumers into stores and entice them to spend money on things like new clothes, decorative items for the home and arts and crafts or hobby kits. Ikea has slashed prices on hundred of products. In April, an 18-piece dinnerware set at Ikea was marked down to $29.99 down from $49.99, a glass door bookcase now costs $189 down from $229 and a bedframe with storage and headboard costs $499 down from $549. It’s telling that these are categories considered to be discretionary purchases, meaning things that are nice to have but maybe aren’t everyday necessities in the same vein as groceries and medicine.