Originally Posted by MTS
Originally Posted by bearisgray
So - in order to buy new inventory - the old/existing inventory has to be priced high enough in order to pay for the cost of the new inventory?
<snort>
Sorry, gaevren, that not a valid argument.
In other circumstances, it might even be called price gouging.
Not:
Noun 1. price gouging - pricing above the market price when
no alternative retailer is available (
http://www.thefreedictionary.com/price+gouging )
Price Gouging
A
monopolistic pricing technique in which the seller takes advantage of the lack of competition by charging
unusually high prices relative to a product's cost. (
http://www.marketing-dictionary.com/p.php )
"Price gouging is a frequently pejorative reference to a seller's asking price that is much higher than what is seen as 'fair' under the circumstances. In precise, legal usage, it is the name of a felony that applies in some of the United States only during civil emergencies. In less precise usage, it can refer either to prices obtained by practices inconsistent with a competitive free market, or to windfall profits. In colloquial usage, it means simply that the speaker thinks the price is too high. Non-pejorative uses are generally in reaction to what the writer believes is an unjustified restraint on the market." and "As a criminal offense, Florida's law is reasonably typical. Price gouging may be charged when a supplier of
essential goods or services sharply raises the prices asked in
anticipation of or during a civil emergency, or when it
cancels or dishonors contracts in order to take advantage of an increase in prices related to such an emergency. " (
http://www.websters-online-dictionar...&sa=Search#906 ) (emphasis is mine)
Nowhere in these easily-found-by-google definitions does it state that increasing prices to cover the cost of replacing inventory in NORMAL market condition constitutes price gouging.
ETA:
To Determine Price Gouging:
Are there alternate suppliers? Yes, quality cotton fabrics can be hand from many stores.
Is there a monopoly by the seller? No, the seller does not control the other stores' business (and pricing) practices.
Is this occurring during a Civil Emergency (some type of disaster like Hurricane Ike a few years ago)? No
Is this product an essential good? No, cotton fabric is not essential to life (food, shelter, utilities, medicine are)
Is a contract being cancelled or altered because of a Civil Emergency? No.
Can the price increase be explained by increased business expenses (wholesale cost, overhead, etc.) occurred in the NORMAL operation of the business? YES!
Since none of the answers indicate a situation where price gouging occurs, then this is a normal price increase that you have to put up with if you want the business to stay afloat.