Welcome to the Quilting Board!

Already a member? Login above
loginabove
OR
To post questions, help other quilters and reduce advertising (like the one on your left), join our quilting community. It's free!

Results 1 to 21 of 21

Thread: Why quilt stores raise prices (even on existing inventory)

  1. #1
    Junior Member gaevren's Avatar
    Join Date
    Jul 2011
    Location
    Quad Cities
    Posts
    178
    Andi's post on "Dispelling myths about Quilts of Valor" inspired me. She's right- when a topic reaches multiple pages many people don't read through everything before posting (totally understandable!) and therefore may miss valuable information.

    Fabric prices are on the rise and I think all of us understand why, at least the basics. Drought, failed cotton crops, etc. all contribute to the skyrocketing price of fabric. The demand is there but the supply is not, and when that happens prices go up. Believe me, it is not in any manufacturer or retailer's plans to raise prices so high that no one will buy! They are literally forced into this position at this time.

    I found a few good links explaining the rise in prices:

    http://quiltedblessings.wordpress.co...fabric-prices/

    http://americanquiltretailer.com/cotton/

    http://whipstitchfabrics.com/blog/wh...ina-this-year/

    So what? you say. That doesn't mean my LQS should raise prices on existing stock. It didn't cost that much when they bought it! They're just price gouging!

    They're not.

    Small retailers don't have the purchasing power of bigger retailers and are often on much stricter payment plans. Many now have to pay up-front for their inventory instead of 30 or 60 days. Add in rising fuel, energy costs, labor costs, import duties, and taxes. If they sell those old bolts at their original prices, they won't be able to afford new inventory as well as their overhead costs and will go out of business.

    As with the manufacturers, it is not a quilt shop owner's desire to raise prices so high that customers won't buy! They don't want to go out of business, but they are literally forced into this position.

    As polyman mentioned in the other thread: "Notice in these comments that all the stores that gave the good prices are no longer in business."

    Hopefully this helps with understanding why a shop will raise prices on existing inventory as well as new.

  2. #2
    Power Poster
    Join Date
    May 2008
    Location
    MN
    Posts
    19,350
    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?

  3. #3
    Junior Member gaevren's Avatar
    Join Date
    Jul 2011
    Location
    Quad Cities
    Posts
    178
    Yes- and my understanding is that a lot of that has to do with the credit squeeze. Banks aren't giving lines of credit like they used to and are reducing or eliminating existing lines of credit as well, so a store has to sell in order to buy, instead of buying on their line of credit. A lot also has to do with the huge sudden spike in fabric prices- it can't simply be absorbed anymore.


    (I should note that I am not currently in business, but that this is my understanding based on the facts I have at hand and my knowledge of economics/small businesses. If I have erred, which is entirely possible, I don't mind at all having it pointed out! That's how we learn!) :)

  4. #4
    Super Member Grama Lehr's Avatar
    Join Date
    Jun 2009
    Location
    Rancho Cucamonga, CA
    Posts
    5,040
    Sorry to say. . . . . but it makes sense. :roll:
    Can you tell me why they have to raise gasoline cost on a daily basis? That gas is already processed, and every company reaps millions in revenue.

  5. #5
    Senior Member qbquilts's Avatar
    Join Date
    Mar 2011
    Posts
    800
    Quote 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?
    :thumbup: :thumbup:
    Yes. Whenever you are selling inventory that you plan on restocking (either the specific item or the general class it belongs to), you need to price it at an amount that will allow you to replace the inventory.

    Think about rising quilt store costs like your insurance. If you needed to use your homeowner's insurance because your 40 year-old house was badly damaged in a storm, would you want the insurance to cover the amount you paid for it at time of purchase (40 years ago) or the amount that it now costs to repair the damage?

  6. #6
    Super Member Glassquilt's Avatar
    Join Date
    May 2011
    Location
    Northeast IL
    Posts
    2,064
    Blog Entries
    1
    Yes.

    For example: I buy a something for $10 and sell it for $20. Call in an order to replace same thing only to find out today's wholesale price is now $25!

  7. #7
    MTS
    MTS is offline
    Banned
    Join Date
    Nov 2010
    Posts
    4,301
    Quote 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?

    Sorry, gaevren, that is not a valid argument.
    In other circumstances, it might even be called price gouging.

  8. #8
    Junior Member gaevren's Avatar
    Join Date
    Jul 2011
    Location
    Quad Cities
    Posts
    178
    Also I totally understand being on a budget and the sticker shock on fabric prices. I love a coupon and/or a deal as much as the next person and try to be thrifty whenever I can!

    I just don't want LQSs to be blamed for something that they have little to no control over :) I've heard people say that they'll never set foot in a particular store again because they're "price gouging" when really they're just struggling to stay afloat.

    Support your LQS! :thumbup:

  9. #9
    Junior Member gaevren's Avatar
    Join Date
    Jul 2011
    Location
    Quad Cities
    Posts
    178
    Quote Originally Posted by MTS
    Quote 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?

    Sorry, gaevren, that not a valid argument.
    In other circumstances, it might even be called price gouging.
    Actually that's not true. Even on necessary commodities (water, food, etc) if a retailer can show that the price increase is solely due to rising costs on their end, it's not price gouging even if the price has spiked.

  10. #10
    Senior Member qbquilts's Avatar
    Join Date
    Mar 2011
    Posts
    800
    Quote Originally Posted by MTS
    Quote 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?

    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.

  11. #11
    Super Member fabric_fancy's Avatar
    Join Date
    Jan 2010
    Location
    at my sewing machine
    Posts
    1,975
    Quote Originally Posted by gaevren
    Quote Originally Posted by MTS
    Quote 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?

    Sorry, gaevren, that not a valid argument.
    In other circumstances, it might even be called price gouging.
    Actually that's not true. Even on necessary commodities (water, food, etc) if a retailer can show that the price increase is solely due to rising costs on their end, it's not price gouging even if the price has spiked.
    there isn't a law against gouging but that doesn't make it the okay with the consumers.

    2 LQS have gone from here now and the next is on their way - all the guilds i am in have a boygott on them.

    the only voice a consumer has against sky high prices is to refuse to shop with the stores.

    i buy all my fabric online and will never shop in the LQS. if i have spare funds to blow i'll give it to a charity not to a LQS and their gouging.

  12. #12
    Super Member Melinda in Tulsa's Avatar
    Join Date
    Dec 2008
    Location
    Tulsa, Oklahoma
    Posts
    4,493
    Blog Entries
    62
    Quote Originally Posted by Grama Lehr
    Sorry to say. . . . . but it makes sense. :roll:
    Can you tell me why they have to raise gasoline cost on a daily basis? That gas is already processed, and every company reaps millions in revenue.
    Now that is just plain greed on the Oil Companies part!

  13. #13
    Super Member Melinda in Tulsa's Avatar
    Join Date
    Dec 2008
    Location
    Tulsa, Oklahoma
    Posts
    4,493
    Blog Entries
    62
    Quote Originally Posted by MTS
    Quote 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?

    Sorry, gaevren, that is not a valid argument.
    In other circumstances, it might even be called price gouging.
    No, repectfully, you are wrong. Small business' work on a small profit margin. If they want to buy the newer, higher priced items, they have to be able to pay for them, hence, having to raise their prices in order to buy them, whether they work off credit or not. Believe me, they hate raising them as much as you do. Their livelihood depends on the customer being able to pay the higher prices, yet still being able to be competitive. If you've ever lived on a strict budget, you know that when stores go up on their prices, and your income stays the same, you have to buy less. The money just doesn't go as far.

  14. #14
    Senior Member
    Join Date
    Apr 2011
    Location
    South Dakota
    Posts
    696
    Quote Originally Posted by Grama Lehr
    Sorry to say. . . . . but it makes sense. :roll:
    Can you tell me why they have to raise gasoline cost on a daily basis? That gas is already processed, and every company reaps millions in revenue.
    Some places get gas delivered every day or every other day. Each load costs more so we are forced to raise the price. Do you realize that your local gas station/convenience store only makes a few cents on each gallon sold? That is before expenses. How many gallons of gas do you think a station has to sell to pay cashiers, maintenance people, utilities, building loans, equipment repair, etc? You can't make money selling gas. Any money they make comes from inside store sales - food, snacks, pop and beer. And the last statistics I saw said that major oil companies had a net profit of less than 5%.

    I am the bookkeeper at a convenience store/gas station and I have to figure out every day how to pay the bills. I get a little tired of people thinking we are getting rich and gouging the public.

    The same principle applies to gas or any product a store is selling as applies to the cost of fabric explained in the OP.

    ETA: And we have to pay for a load of gas when we get it. If we sold the last tank for $10,000 and the next load is $12,000, where do you get the other $2,000? It is the same for the fabric stores.

  15. #15
    Super Member
    Join Date
    Feb 2011
    Location
    DC metro area
    Posts
    1,249
    I'm not sure it's price gouging so much as small stores can't afford to offer the bigger discounts that on line stores can. That don't have the volume of sales that's required to get the better prices for products.

    LQS prices have always been higher then other stores, but it serves a nitch. Some people like the higher quality fabrics that they can go to the store, feel and fondle. Other people prefer to trust a manufacturer and just go with the best price.

    I personally rarely shop my LQS because of price also. I hit JoAnn's with my coupons.

  16. #16
    Super Member
    Join Date
    Jul 2010
    Posts
    1,510
    I work for a "mom and pop" type business. Our sales are right up where they were last year at this time. However, their costs for supplies have increased tremendously. small business owners are between a rock and a hard place. raising prices will lose some customers and yet if they don't, they can't afford to restock.

  17. #17
    Senior Member quilter41's Avatar
    Join Date
    Sep 2009
    Location
    N Indiana
    Posts
    529
    I don't believe that. It is a rip off when they raise the price on every bolt in the store. And I know a LQS that does that. I call it gouging the customers. Therefore, I no longer shop there.

  18. #18
    Super Member thepolyparrot's Avatar
    Join Date
    Nov 2010
    Location
    Mars
    Posts
    2,038
    Quote Originally Posted by Barb44
    And the last statistics I saw said that major oil companies had a net profit of less than 5%.

    I am the bookkeeper at a convenience store/gas station and I have to figure out every day how to pay the bills. I get a little tired of people thinking we are getting rich and gouging the public.

    The same principle applies to gas or any product a store is selling as applies to the cost of fabric explained in the OP.
    Agree with you 100%, Barb.

    I'm really tired of people accusing business of gouging or somehow being underhanded in their business practices when they're only trying to make a fair profit and stay in business.

    Organized boycotting of a LQS for charging normal retail prices is misguided at best and unjust at worst. LQS's aren't trying to chase off customers. They're trying to pay their rent and keep people employed.

  19. #19
    Super Member
    Join Date
    Mar 2009
    Location
    Maryville, Tn
    Posts
    1,791
    Actually the price of gas is going down around here.

    Also.. I don't mind paying the increase in fabric cost... however.. I do think there (used to at least) be a "rule or law" about changing the price obviously on a product.. if something is marked one price, you can't just draw a line through it and put a higher one on it.. I could be wrong.. heaven knows I have been before.. but it does rather irk me. Or the shelf is marked up but the bolts aren't and the clerk says.. Oh.. it will be marked up at the register... that is just SOOOOO wrong. then why not just say.. oh we'll decide what we want to charge you at the checkout.. you don't need to know the cost .. just pay it. I have had this happen at a retail shop. and rather than price gouging I think it falls under "bait and switch".

  20. #20
    Super Member LucyInTheSky's Avatar
    Join Date
    Sep 2009
    Location
    Seattle
    Posts
    1,788
    Quote Originally Posted by qbquilts
    Quote 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?
    :thumbup: :thumbup:
    Yes. Whenever you are selling inventory that you plan on restocking (either the specific item or the general class it belongs to), you need to price it at an amount that will allow you to replace the inventory.

    Think about rising quilt store costs like your insurance. If you needed to use your homeowner's insurance because your 40 year-old house was badly damaged in a storm, would you want the insurance to cover the amount you paid for it at time of purchase (40 years ago) or the amount that it now costs to repair the damage?
    That is a really great analogy!

  21. #21
    Senior Member Jamiestitcher62's Avatar
    Join Date
    Jul 2010
    Location
    Connecticut
    Posts
    744
    You mean kind of like gasoline? When the price goes up you notice that at the pump it goes up that minute even though that gas has been sitting there already, but when the price goes down the price at the pump stays the same.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  

SEO by vBSEO ©2011, Crawlability, Inc.