Chuckanut
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Here's an interesting article in today's (7/31/017) WSJ.
It's probably behind a pay wall.
https://www.wsj.com/articles/the-high-cost-of-raising-prices-1501446630
The article concerns companies that are losing some combination of profit, market share and revenue and respond to the problem by raising prices to make up the loss.
It starts of with this amusing story:
It's probably behind a pay wall.
https://www.wsj.com/articles/the-high-cost-of-raising-prices-1501446630
The article concerns companies that are losing some combination of profit, market share and revenue and respond to the problem by raising prices to make up the loss.
It starts of with this amusing story:
Consider the life of a wealthy expat who asked a broker to show him the most expensive apartments in Rome. The first, at €20,000 a month, was a dump. So was the second, at €18,000. Yet the third apartment, at €16,000, was well-maintained, with gorgeous views of the Italian capital. Sensing confusion, the broker explained that the first two apartments had sat empty for months—and the owners kept raising prices to make up for the lost rent.
Yet the sports channel’s subscribers have dropped from 100 million in 2011 to 89 million today. So ESPN raised prices, from $4.69 per sub a month to $7.21 today, a fee five times as high as any other channel. This newspaper reported earlier this month that Disney is in talks with cable operator Altice USA to raise prices again by perhaps 6% a year and institute “minimum penetration guarantees” to make up the difference. We’ve seen this movie before: ESPN may be a few price increases away from losing another 11 million subscribers.
I know that I have walked away from several purchases this year due to higher prices, or in the case of things like coffee, meals out, etc. I partake of them less often. There is a limit as to how much I will spend for glass of wine, even at happy hour prices.Increasing prices attracts others to attack your market. Amazon’s Jeff Bezos warns: “Your margin is my opportunity.” We’ll see devastation from rising prices in lots of places: ObamaCare premiums, personal tax rates in Illinois, cap-and-trade costs in California, wages in China.