A new form of Retail Therapy
SummaryBy, Chengcheng Guo
This article “A New Form of Retail Therapy,” written by Pat Edwards is about pricing of products that retail stores sell and new ways of buying cheaper products. It starts off by telling you that all businesses including retail stores and shops do not make any profit until the overheads are paid first. Overheads include, rent, rates, staffs and advertising costs which can fly through the roof. For businesses to earn profit manufacturers has to accept the fact that retailers will multiply the cost by to or three times after arrival. If the product is a high-end good such as big-brand watches the price can even be ten times the manufacturing cost! But that is how the retail stores has worked for many years, however recently this way of living for retail stores has been challenged by other ways such as the internet. When the internet is used the business gets the opportunity to cut out the middleman, which then leads to better deals to the customers. Using this method, customers can purchase what they want in the means of their own house without the need to go to city centers and shopping malls. This method also allows the business to cut down their expenses such as rent costs. But “real” stores argue that they allows customers to examine the product before purchase. Because of this problem online business came up with a solution. Their solution is to send samples of the good by mail to the customer’s home. However even with all these services provided by internet businesses there are still a growing realization that customers want to shop the “old fashioned way”. That is what this article “A New Form of Retail Therapy,” written by Pat Edwards is about.
CritiqueBy, Chengcheng Guo
After reading this article I was stocked to find that the retail price of a high end good could cost tens the price they brought it at from the manufacturer. That would mean that, for example UGGS shoes that they still at stores for up to 500 dollars are really worth 50 dollars. Or Vitess bikes that sell for 6000 dollars to 14,000 dollars are only worth 600 dollars to 1400 dollars. Because of this huge price difference retail stores should be making a lot of money and in our current economy I don’t know why the government hasn’t made a law to put a temporary top on how much retail stores can multiply their price by. If the government did put on a temporary top I think that our economy would gain a huge boost because people will not only be able to buy their everyday material but with all the money left over, everyone will start to live in higher standards which means spending more money in our economy which further leads to a booming economy.
I disagree with the article when they say that there are a growing number of people that like to shop the old fashioned way because of many reasons. My first reason is that why would someone buy something that is 500 dollars such as UGGS when they can get it online from the manufacture for 50-100 dollars in the near future. Second, people now a day have less and less free time on their hands. 40 years ago people can finish high school and get a good job with lots of free time on their hands. 20 years ago people had to finish high school then go to university to find a good job, and it was a much harder job which took up more or their time, which means less free time. Now a days if you want a good job you need to finish high school, finish university, and then after all that, get a professional destination to find a good job which means a even harder job with even less free time on your hands. And this seems to be growing, year after year companies expect more and more from the average person, giving them jobs that are harder and harder so more and more free time will be cut out which then leads to people not having enough time to go to shopping malls or town centers. This will allow web-based companies to grow because of all the new customers. Lastly because as this generation grows up and the next one comes they will be more likely to shop in a “new fashion way” instead of the ‘old fashioned way”
A New Form of Retail Therapy