Forum Post: Why do retailers feel they have a right to make the highest profits possible ?
Posted 12 years ago on Dec. 11, 2011, 3:24 p.m. EST by FriendlyObserverA
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Where does this right come from ?
Having a "right" to the highest possible profit is not really the issue. The profit just can't occur at ANY expense and everybody needs to play by the rules.
there are very few pricing rules. the "rights" concerned are the right of the retailer to make any ungodly sum... but this right is supposed to be KEPT IN CHECK by the consumer's right not to buy. if prices get out of control, it is because the consumer has failed to exercise his or her right...
I just returned from a very upscale mall laughing at the prices of sweaters $250 for a fairly nice looking sweater, $150 for checkered button down shirt, $160 for decanter. I don't know what sucker buys at those prices, but a fool and his money are easily parted. This mall is a perfect example of the consumer's failure to exercise his rights... I exercised my right to a $3 bowl of soup, and bought nothing.
Monopolies and virtual monopolies control prices. Telephone service, gasoline, etc.
In order to fund the people of Saudi Arabia http://occupywallst.org/forum/breaking-news-the-usa-funds-100-of-the-socializati/
to some extent that's true but it's not by rule, and price fixing and collusion is illegal, except for the OPEC cartel. but the consumer can opt out of, for example, cable if they don't want to pay $1,100 per year. if enough people do that for awhile, cable pricing would decrease.
Illegal means nothing when you make the laws with legal bribery. You can not use cable but how can you not use gasoline or telephone? The consumer is a captive audience for products and services for which the only alternative is being destitute.
Or for which the only option is seemingly destitution. For the most part, the Amish get by.
How is telephone service or gasoline service a monopoly? There are 10 different brands of gas within five miles of me. I have a choice of at least 7 phone service providers maybe more. By the way gas is cheaper in the US than in most other countries.
Because all the gas at each station comes from the very same gas storage depot. Retail prices do not vary by more than a few cents, and that is at the gas station level, not the distributor level. There is no real competition.
Because Verizon and ATT each have the ability to substantially undercut the other but don't, thereby maintaining a price level that guarantees their mutual profits. Smaller companies cannot afford to build networks to compete with them, and purchase time on their networks, which creates the illusion of a competitive market.
Actually gas prices vary by as much as 20 cents a gallon by me.
Did you know that there is a government regulation prohibiting gas stations from charging less than wholesale? See what happens when government gets involved. Retailers wanted to charge less so you would go in and get a cup of coffee and a doughnut. Somehow the government decided it would be unfair for some gas stations to charge less than wholesale.
There are more than two choices for phone service Verizon, ATT, T-Mobile, Sprint PCS, Embarq, Nextel, Alltel, U.S Cellular, Virgin Mobile to name a few.
EXACTLY.
The retailers only have as much money as you gve them. If you think the price is too high don't buy the product, or else wait for a sale (~40% off), or wait even longer for the clearance (~80% off). It isn't that hard.
Last year I bought several wool suits for work at a mere 75-90 dollars. It makes no sense to pay $400 for a suit when you can get it for much less on sale or clearance. THAT is the power of being a consumer - Say "no" to retailers if you think they make too much profit.
BTW retailers really DON'T make that much profit. It averages out to less than a dollar per piece of clothing. For grocery stores it's even smaller... a few pennies.
smart people should probably exchange gifts jan. 25--they can buy twice as much stuff for the same amount:) or spend half as much:)
That is the spirit of capitalism Earn more doing less It's normally approved unless you are an employee
What is funny is that everyone hates the company that has the lowest prices.
Sam Walton made it a practice of passing any savings he got on special deals to the customer. His competition kept the profit for themselves. His philosophy worked well for him and it made Walmart the largest department store in the world.
Now everyone hates them because their prices are low and they undercut the prices that small businesses charge.
Ask any walmart employee. The rumor is that walmart is run by a dictator.
And since mr Walton and two co owners are on the fortune five hundred list. Tells me with all the deals he passes on to his customers. He was keeping the best deal for himself.
From sea to shining sea there are examples of commerce. One man starts one company. Another man starts yet another and so on and so on across the country. Millions of companies where people put their money where their mouths are. And yet. I dont recall driving across this country and seeing a "FriendlyObserverA-MART" in any town. People had a dream and created something. If everyone believes in YOU one would have to assume you could start your own MART and sell products at little to no cost and fullfill you dream. Or maybe you are just wrong.
Exactly,
Most of America shops at Walmart for their low prices. Poor people especially love Walmart, Target, and Kohls.
They love the low prices and they can ride around in those battery carts so they can get even less exercise after they buy ice cream, , chips, cookies, diet pop by the case and 5 huge bags of dog food for their 10 dogs using food stamps we paid for.
I would have complete transparency with my prices, profits, markups, and customers.
I would name my establishment, plus - ten Ten would represent markup on everything.
Show me one retailer from sea to sea that would display full honesty to their customers !
I would love to show your company, or at least the one you have wet dreams over, that does this. Unfortunatly, YOU DONT DO IT EITHER. Talk is cheap,, how about setting examples. Your talk is cheap and YOU have ZERO examples of what YOU are capable of doint. ZERO. If it worked in your perfect world then you would be the talk of the world. But,,,,, your are just that,,,, TALK. As NIKE says,,,, Just Do IT. But you wont you would rather whine and complain about how others do it. You post your 1-800 number to your transparent store and i will be your first customer.
So you like the idea. ?
Sure I like the idea. Post the name of your transparently operated store and I will buy something. I have no problem with that. If you have and your customers are in love with it then I would be happy. But to suggest OTHERS do that and you dont do it is whining at the top of the list. If the customers dont like it, you will fail and i would believe you would then understand how the customer is right and you are wrong.
Ideally, stores should be government run as non profit.
Exactly. You don't even know the meaning of freedom.
the capitalist thinks freedom means he can freely ride on my back ...
Ah, finally, the little commie dictator is exposed. Those that can't provide anything useful to society are very critical of those that do. And when their incompetence and impotence is revealed, their only answer is to call for the guns of government to force others to do their bidding.
The retailer owns the product. He has the right to keep it, or to sell it for whatever price he wants.
(This does not apply to highly regulated industries such as health care, public utilities, etc.)
BTW, I have a small business and I charge as much as I think I can get for the service I provide. But I have to watch out for the competition, and as market share starts to drift away I have to rethink my pricing. That's how it works.
What if your business is logging forests .. and with all the competition you inadvertantly log every forest on the planet.. see how taking too much is a bad thing ... or if you were a fisherman and fished all the fish from the ocean ... there needs to be limits.in order to survive..
Your examples are silly. You're laying out impossibilities,bad analogy.
Well the idea that competition has anything to do with fairness is grossly inappropriate.
You must have lost a lot of competitions to hate them so. OWS is always talking about fairness but who made OWS the people to decide what's fair?
You forget that current laws require companies to replace every tree they cut down with seedling. So your scenario is nonsense. ALSO you've forgotten that products built from trees are the most environmentally-friendly because it's a renewable resource (just grow more), unlike products made from plastic or metal.
Just grow more???
"Mom, that seedling is taller than me!!!"
"That's a redwood son. They get 20, maybe 30 feet high. They used to be round and they only came in red."
So now you know the reason why not a huge amount of logging is done in the US. Most of the logging that is done, is not for the wood, but because it needs to be cleared out for some other reason. In other places nothing needs to be done. This is why the amazon is shrinking, and the amazon is a pretty big source of our oxygen (The ocean is a much bigger source but we all think its ok to keep poisoning it.) As with overfishing there are no enforced rules in international waters so the fish stock is WAY down because of overfishing. The air is horribly polluted coming out of china. This is all tragedy of the commons.
okay .. so current regulations were necessary to overcome overlogging .. same reason why we need CAP on profits regulation to prevent over gouging.
Natural resources are regulated very strictly. If one over fishes, or logs too much, huge fines are levied, and this person may be pushed out of business.
okay that's one for regulation .. is my point getting through to you yet ?
Who said anything about being against regulation? I'm all for regulations including the most improtant one (do not kill your neighbors), but that doesn't mean I think the government needs 160,00 pages of them.
The EU government recently passed regulations that say is a cucumber or banana is not curved, then it';s not a cucumber or banana. They also regulated that a bottle of water is NOT a cure for dehydration. We need SOME egulations..... we don't need every little tidbit of our lives run by idiocracy (government bureaucrats who are dumb).
We've had massive regulation, in fact over regulation for decades, in the natural resources area. You mentioned retailers in your post, and, no, I believe their is no need to regulate the amount of profit a retailer seeks.
well retailers have "over fished " the money from the economy ..and now the economy does not have enough money to sustain society. a cap is necessary to prevent " retail over fishing"
FriendlyObserverA is still trolling? Every time I call out his bullshit he deletes his own posts.
utter bullshit. sorry, but there's just no other way to describe your statement.
Then how come Montgomery Wards, Circuit City, ad many other retailers are going bankrupt? They should be rife with money (by your logic), but instead they are going broke and disappearing. I suspect your lofic is seriously flawed.
because they fished their customers dry and are packing up .. they made their profits..
FriendlyObserverA gets it wrong AGAIN. An absolutely brainless twit with the same myopic focus on a "retail sales cap" as StuartChase has on single-handedly bringing down Toshiba. And to think they call OWS protesters crazy.
Wall Street was one of the major factors in the demise of Circuit City:
"To please Wall Street analysts, it went on a store expansion spree that resulted in too many stores in dicey neighborhoods.
To save money, it stopped paying commissions to its sales force and then fired 3,400 of its most experienced sales people.
When the going got tough, too many C-suiters and directors came and went.
Commercial credit became tight.
Finally, after a proxy battle earlier this year which gave outsiders three seats on the board, Circuit City seemed poised for a serious comeback strategy. But the financial crisis hit and with it, the commercial paper crunch meant that vendors were not willing to supply Circuit City with goods, fearing that they'd be trapped if the firm suddenly sold off stores. The firm has announced the closing of 155 stores."
Again, you make a bizarre argument. We need a growing economy, and under the current administrations policies, it will not grow. To think that retailers have made too much profit and taken too much money for the economy is the most bizarre thing I have ever heard. Have you ever had a basic course in economics? What has hurt the economy most is the massive expansion of the federal government. They create jobs by stealing money from the populace. Removing billions of dollars from the private economy, and funneling it to the public sector is a job destroyer.
a sales profit cap will lower prices , increase sales , increase jobs, and increase tax revenue ..
the cap goes on banks , retailers, wholesalers ,, all points between buy and sell .. the people at the top have a pile of money gained through profits and this is causing economic strife
Prove it. I've repeatedly challenged you to provide some evidence for this absurd conjecture, and your response has been to delete your own posts.
Put up or shut up.
"all points between buy and sell"
Freedom means nothing to you.
having someone freely ride on my back .. is not freedom .. Capitalism is not freedom
Excuse me, I'm talking about not having people getting in between my "buying and selling" since those are my business, and theirs, and not anyone else's.
You can check your pontifications regarding 'Capitalism'
the points betwen buy and sell is the free ride your looking for .. the wider the gap .. the better the ride .. for you .. but not better for the back you are riding on ..
Capitalists are looking for a free ride ..
What on earth are you talking about? Free ride?! No, buying and selling is MY business. Nobody is involved but the buyer and the seller. It's not anybody else's concern.
You want the government involved while you 'ride' your wife? That's your business. Nobody else's.
What about when you plow your fields? Comb your hair? Drive to the store? Paint a picture? Teach your son to catch; imagine things...
All your business, nobody else's.
No, it would be your wife's business as well, and she has every right to make a claim against you publicly if she chooses.
It is incongruous for you to compare 'wifebeating' to 'capitalism' since the buyer and seller are consensual.
a business transaction is everyones concern . as you see the economy around you becomes everyones concern .. if you beat your wife is that only your business ? well it used to be but not anymore , there are laws against that .. as we need laws against the perpetual free riders
People are in economic strife because of government policy. Why should I give a damn what my neighbor makes? It has no effect on me or you. Wealth is created. Because I make more money does not mean someone else makes less. If the economy is growing, wealth is being created. If I am making more money, I am paying more in taxes, and the government gains more revenue. This control everyone idea of yours is a remarkably stupid one. Competition forces prices down. Their is no need for the politburo to set prices.
government policy needs to improve regulation on capitalism.. cap sales profits ..
No one I have seen advocates NO regulations. That is just hyperbole from liberals. There are common sense regulations, and then there are onerous regulations. For instance, there are safety standards on cars which go a reasonable way toward ensuring safety of passengers. However, we don't require NASCAR like rollbars, helmets, neck restraints, fire extinguishers, giant exploding air cushions on your bumpers, ejection seats with parachutes, or whatever, to make it impossible for you to die in an accident. That's the point. Reasonable. In general though, as long as you are not forced to buy a product from someone or a company, what difference does it make to you what price they charge for it?
But there are no restraints what so ever on profit mark up .. and this has caused harm to the economy and lives .. it is time we put some restraints in place .. just as we have installed seatbelts and childseats .. it was necessary ..
Spoken like a true idiot. There IS a restraint. Two in fact. (1) The citizens who decide "that's too expensive" and don't buy the over-priced item. (2) Competition from other vendors who push the price down in order to gain advantage. Both of these are the "invisible hand" you hear about in the free market.
The fact you didn't know this basic ECON 101 tidbit demonstrates you must be ignorant. Goto isohunt.com and download some economics textbooks. Read them.
competition from other vendors is not a restraint.. thats like two wolves fighting over the henhouse ..
as for buyers if we want something we pay the sellers price.. the final decision is the sellers noit the buyers ... the buyer doesn't come into your store and tell you how much he will pay and than take the product at his price .. ?
That happens all the time.
It wasn't necessary. It was desirable but not necessary. I bounced around on the front seat as a kid while my mother drove. Did some people die? Yes. People die today, some not wearing their seat belts. Some getting hit by airbags. Lots of good the law did them. By profit markup, you'll also limit what people can be paid for their jobs. With more regulations, you'll increase the cost of the products, so the price to the consumer will go up anyway. I'm assuming this profit cap is also for services such as attorneys, surgeons, engineers?
profit caps will affect the earnings of the middlemen .. and the people they employ correct.
no, the cap only is applied to sales of merchandise. not services
So it would seem natural that in the future there would be less availablity of store merchandise because fewer people would opt for owning stores. It would be the new "factory job". People would have incentive to go into other fields unless they wanted to go into the field where there was no upside to their work. Much like being a secretary or factory worker. The middlemen today are the wholesalers who don't make that much now to begin with.
here is an example from a reliable source:
A domestic manufacturer of a very well known and admired product builds a part for $50 .
the wholesaler repackages the part and ships it to the retailer for $100.
the retailer places it on the shelf and sells it to the consumer for $450 .
now the math is 800 % mark up total .. from manufacture to consumer..
next
So your middleman is the retailer? Ok. Fine. Doesn't change the fact that if the retailer has to sell it to the customer for $200, that the retailer isn't going to make much money. Volume, you say? You'll turn every tom, dick, and harry retailer into a walmart. Their competition will look for a way to buy cheaper and thus sell cheaper than their competitor (or are we to have no competition at all?). Do you see where all this leads?
no it wont .. since prices are now at a reasonable amount .. for quality product .. consumers will look for quality .
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except if your opec then u charge whatever u want
In the US we have antitrust laws. But even OPEC has some limits, as there is some dissension among the members of their cartel. And if they allow the price of oil to get too high, people conserve and find ways to avoid buying the product (a gasoline price of $4 a gallon seems to be the tipping point for significantly influencing people's behavior). And at a high price for liquid oil, other sources of energy (including tars sands and shale) become more economically feasible. But that opens a different can of worms.
antitrust laws wow those work good, people conserve? if you heat your house with oil you decide what you want food or heat, course it dictates peoples behavior they have no choice.
The will of the people. Same reason we re-elect 90% of incumbents.
it ain't just retailers by the way. so you think ? they should maybe just charge you what it cost them ..is that fair? wouldn't leave much on the table at the end of the day tho eh? in answer to your question the truth is they can really only charge as much as people are willing to pay.
There are two ways of looking at this.
The retailer believes demand makes prices go up. And they have a curve to proudly show how this develops.
But there is another graph. One that shows high prices reduce demand. And the curve actually drops off as reduced demand stalls the economy.
Why do consumers making high wages feel they have a right to rock bottom prices?
We need government run nonprofit retail shopping. The current retail can get off the backs of the working man.
The solution to too much governing is not more government. Big government, big unions, result in big business.
A government run by the people can never be too big..
When you can't see below your belly, you're too big.
Tell that to the greedy capitalist.
Many of whom comprise the 99%
perhaps I should have said " greedy retailer"
You could have said greedy consumer
well , I challenge retailers with transparency. show the consumer the true mark up? I doubt any will comply.
We all sell something.
interesting, and how much did you lose for your soul?
A lifetime of work. Did you give your's away or did you sell it to the highest bidder?
why do you feel you have a right to tell someone else what to charge for their product? If someone is going to force me to charge x & not y for A then maybe I will stop producing A. Not worth my time & effort. You people like to talk about enslavement - what do you call this?
Retailer and producer are not the same entity. Although the retailer likes to think he is as worthy as the producer , he is not.
that doesnt answer the question. "why do you feel you have a right to tell someone else what to charge for their product?"
Well your question indicates producer will be told what his price can be. This is a false understanding. For the idea of profit cap goes on the retailer not producer. As I tried to point out with my first response.
So the right to control retail profits. If that was your question, comes from the right of self defense. The retailers high profits have/are harming the economy.
where does the right to tell someone what price they can ask come from?
The government has a constitutional obligation to the welfare of it's citizens.
yes - to uphold the constitution doesn't mean giving out other peoples money to preferred voting blocks. It means enforce the property rights, provided for a common defense and protect the citizens from physical harm. Period
And economic hardship
that is what private charity is for. when government does it it creates dependency in exchange for votes. a culute of entitlement is what is being created. What government giveth - government can taketh away. Is that how you want to live? at the mercy of the govt? Like when Obama threated not to send out the social security checks when negotiating the debt ceiling? How about being self reliant so no one can hold you hostage for your vote? you dont see that is why they like to give out free stuff? to buy your vote!
But you are forgetting. Americans long ago rose up and threw out tyranny. It is back under a new name, Capitalism.
The tyranny is the govt. They make the laws. As an economic system Capitalism stinks. it's just better than all the others. We dont even have a purely Capitalist society. It is a mixed economy. Maybe that is the problem.Your movement cant come up with one coherent set of principals that have any proven validity as to being superior to Capitalism. Give me your model country in any time in history for us to compare. 100 bucks says you wont answer this question.
See that's where you limit your imagination. You think if it has never been done before than it won't work. That's why you ask for a history example.
History is a place where we learn from our rights and wrongs; our mistakes and successes The future is where we dream of better days ahead.
To answer your question there is no perfect model in history. But looking at all models that done quite well but eventually failed. I see the common failure being that the model was built on " unfairness ". And all systems will fail built on unfairness , as will capitalism.
well - I only ask for a historical reference because you have no coherent plausible plan yet to be articulated. All I hear are utopian platitudes of how you think things should be rather than what works. Desires are not rights. Life is not fair - get over it & focus on what you can do in this life besides occupy different places & throw a collective temper tantrum which is what this is.
Everyone in the movement agrees we are living in a world filled with unfairness and inequality.
yea - and ? you expect to change this by occupying the park lol!!!
well , to my knowledge this is the first time we openly are having a discussion ..
there was a time when anyone spoke badly about capitalism , they were immediately frowned upon ..
we have made the first step .. to making the world a better place .. simply by opening up dialogue.
Dude, if you don't like it shop somewhere else. It's as simple as that.
and if you dont like the low wage your employer is paying you go work somewhere else .. but soon you will see there is nowhere else.. and the control you thought you had .. you did not really have .. it was just some figment of your dillusional mind.
Simply put - because they do.
They make an offer of a good at a price. Everyone is free to accept or deny that offer.
If people accept it that action indicates people value the good more than what they are trading for it. If that happens to be at a high profit for the retailer then so what - people are still free to say no.
simply put- your argument of demand and price signals .. will be considered at the manufacture level ..
next
Which as I've already stated don't help because it isn't the retail locations that create demand - it is the end consumers.
but you argue the importance of retail and all its ability to properly adjust demand through price signals .. is a bunch hogwash ..
retail is nothing more than glorified warehouse clerks.
The importance of price signals occurs at whatever point the consumer can buy from the supplier.
It doesn't matter if the supplier is the manufacturer (a direct purchase) or its 4 or 5 steps down the line (a retailer selling hand made imports for example).
Since you still have a retail location in your model but you fix prices - this is the result of your system.
If you want less cost - same efficiency distribution of goods you should advocate for more manufacturers to allow direct purchase of goods to consumers through a website or such. Low overhead, low maintenance, and the manufacturer could likely sell for higher than they do to distributors and retail but still at lower end cost to the consumer (though economies of scale may come into play - it is business dependent).
This maintains price-signals and thus effective production and supply ramping while lowering end consumer cost, and possibly increasing manufacturing profits - this is one very strong reason that internet direct sales have taken off. - As you can see the market is already doing what it can to lower consumer costs.
Wouldn't hurt to create a business that helps manufacturers do this - many are still very old school and are scared of the internet which they don't understand as they started the business before computers became big. You could make money while helping consumers and manufacturers at the same time you punish retailers which you don't like. win-win-win.
At least that would be my suggestion in order to get the goal you wish without negatively effecting market signals.
price signal doesn't have to be at the point of the consumer.. price signal always ends up at the manufacturer .. through orders of product .. what the hell part of this is too complicated for .. you .. well of course you are just an opponent .. to the whole idea beacause such a CAP would prevent money from reaching your greedy middleman pocket .. so argue all you want .. you really don't have an argument ... just a complaint..
Yes the always end up at the manufacturer but they aren't created by retail demand - they are created by consumer demand. The retailers measure that by looking at how much consumers are willing to pay and still exhaust supplies. The higher prices help limit demand to those who demand it most while the increase in profits of the high prices dramatically increases orders to the manufacturers.
With the end distribution point being non-profit and with price controls the ability to judge that consumer demand doesn't exist so it cannot be communicated back to the manufacturer. Higher prices mean higher demand with constant prices the only thing that can signal demand is selling out - which while being a rough indicator does not provide detailed information on rapidly increasing and decreasing demand as would price signals.
There is a lot of information on price signals available online including some recorded university lectures. If you're really interested I suggest checking them out in your free time. Unfortunately today is my second to last day at work so I need to organize my office and clean out and throw away a few things and put the ones I want to take home in bags.
thats hogwash I tell you .. the retailers are in fact slowing demand down by trying to reach the highest profits on each sale .. volume comes to a crawl when this happens and the manufacture lays off employees all because the consumer does not pay the outrageous retail profits .. thats what your price signals actually signal to the manufacturer .. they see the retailer marking up a product so high that they know sales will be low ..and demand will be low .. and the manufacture can not do a thing about it once it gets in the retailers habds .. the retailer fucks both the customer and the manufacture ..and the whole economy.. just to satisfy their greed and self right to it
It doesn't slow demand down by trying to reach the highest profit. Price is set where demand and supply meet. High demand causes high prices not the reverse.
Retailers have no ability to get high profits simply by setting a price based on whim. If they set it too high the goods do not sell fast and so depreciate or spoil on their shelves - if they set it too low they don't get the profits they could invest in purchasing more of other goods.
Anyway really need to go now and finishing cleaning up here.
.. high prices slows demand .. ask any manufacturer ..
Yes that is what a person learns on day one of micro-econ when they talk about a demand curve.
This actually shows why price signals are an important factor because with a flat line instead of a curve what happens to the the intersection of the supply-curve with the demand curve that determines price?
..and if they need the good ..and the price is unfairly marked up ..
they are forced to sacrifice.. the only other alternative .. do without
retailers have control over consumer wealth .. it's time we take that control away from them .. the retailer does not have that right.
Retailers don't have control over consumer wealth - consumers do. No one is forced to buy retail goods. If you want a tv more than the money they ask for it - that is your decision to make as an individual.
You cannot have a thing "unfairly" marked up. You can't offer an agreement that is unfair because one can always reject the offer. I want 800 dollars for this half used bottle of hand sanitizer. Don't want to pay 800 for it - then don't.
It's simple. Very simple.
Just because you don't happen to like the price you would have to pay for certain items doesn't mean it is unfair. No one is "forced" to sacrifice - they choose to and usually wisely because it means they are taking care of higher-order needs or desires.
That you believe no one should ever have to feel they sacrifice is mind-boggling to me. Life is not supposed to be - nor will it ever be - a system of ease and comfort for all, or most, or even many. Life is about making decisions and no one ever said every decision offered has to be a rosy one - if that is what you expect out of life you need to seriously adjust your expectations or you will be continually disappointed and never happy. Whomever set this level of expectations with you did you a very very large disservice.
so , when I want to build a house , and I go down to the lumber yard I have a choice . I either pay the retailer his triple digit profits or I sleep on the sidewalk .. my choice my sacrifice .. the retailer has no concern of me sleeping on the sidewalk , my health or well being .. he sticks with "his right" to charge with whatever he wants .. and me the consumer is expected to fill his fatass pockets with profits if we want to build ourselves a house..
listen , don't expect me to feel empathy for the retailer.. If I could I would replace retail outlets with a nonprofit government run organization.
"I go down to the lumber yard I have a choice . I either pay the retailer his triple digit profits or I sleep on the sidewalk "
The typical markup on lumber is in the 15-20% range. Some lumberyards use lumber as a loss leader, and make their money on tools and things like that. Net profit margin at lumberyards is in the 4-5% range.
You seem to have some kind of ax to grind about retail.
when I see retail transparency I will agree with you
Or you go to someone else or you go to a construction company or you can choose to build a pre-fab home, or build your own log home, or concrete, or earthen berm, or, or or or.
If you have enough money to buy a house's worth of construction material at a lumber yard you aren't going to be sleeping on the streets and you know this.
It isn't nor should it be the retailer's concern about your quality of life - that is yours to concern yourself with.
A non-profit government run organization you believe would have any incentive to provide to the consumers what was demanded? No profits means no price signals so how would they even know what was demanded in order to provide it?
You have some wild assumptions both about human nature and how market's work to supply demand that you should really study more in depth.
I strongly suggest you read this http://www.amazon.com/Economics-One-Lesson-Shortest-Understand/dp/0517548232 it is a very short read that should give you some grounding in order to understand a system enough to begin to critique it. It will likely cause you to ask some questions which will need to be answered before you can even hope to offer realistic improvements.
The government is much much more capable than you give them credit for .. a simple retail outlet would be childsplay !
I suggest instead of making a blanket statement you answer the questions relating to understanding demand, price signals, and the like.
If you cannot answer them then maybe you need to understand there is a reason you cannot answer them - and that reasoning should clue you into the fact that you need to learn more about what you're talking about.
well a quick response .. the demand and price signals would fall back to the manufacturer ..
They won't have price signals either. A seller is not going to pay more for a good than it sells for, if the object sells out and there is no increase in price no new equilibrium will be found. With price signals a significant increase in demand can be measured.
For example say that good X experiences a dramatic rise in demand. In a system with no price signals we simply see the good sell out - be replaced and sell out again. A signal to order more (but not how much more is sent).
In a system with price signals we see the good sell out - be replaced at higher price - and see it sell out at higher prices. This is a signal to order much more because the profit motive will cause this good to be at a higher profit % than others and thus order more at fast turn around and provide more display space.
The later case allows demand to be reacted to more quickly because it is in the interest of everyone to do so. The former causes a much slower measurement of demand and thus a much slower reaction to it. This causes an untimely and inefficient allocation of resources.
This is only one example of how a command economy faces fundamental problems of distribution that a market economy does not. There are many more.
you're trying to make this sound ..soo difficult ..
when in reality .. its as simple as stocking shelves
No it really isn't that simple - that is what I am trying to convey to you.
You assume it is simple because it currently happens in a market system. You are assuming your change will not have consequences beyond which you hope to change. This is never true for a complex system.
there is absolutely nothing to it ..
the truck brings the goods to the back door , the goods are unloaded and placed on shelves .. the price tag gets a couple zeros added to it , the customer picks up the goods and pays for it on the way out .. retailer goes home with pockets full of profits .. not bad for a days work.
Life is always so simple because you want it to be simple - that is what I get from your statement. It's likely you think it is like that because you've never actually done the work required of the person you are critiquing. You've never seen the work so you imagine there is none or it is minimal. A very narrow perspective to have as the existence of the work of others is not dependent on your observing that work.
I am afraid for your sake that life is rarely simple and never becomes so either because you want it to or because you think it already is.
and try to make it difficult with fancy riddles .. to what end .. ? justify your superiority .. retail is as simple as selling potatoes.. absolutely do not have to be a rocket scientist .. or structural engineer to do the simple math .. of retail.. perhaps it is diffecult for you .. truly and sincerely .. but for most of us its as plain as as bread and butter..
These aren't riddles. I am simply pointing out one consequence of your action that you hadn't even considered because you didn't know that the effects existed.
My major was astrophysics so no, the amount of math used in retail is not difficult. I simply understand the interactions of different entities that result in the end you see but did not think about.
The fact that you choose to label a simple question regarding price signals as "fancy riddles" indicates you've never attempted even a cursory inspection of that to which you propose drastic changes. This demonstrates you don't have a desire to understand the system, it also demonstrates that you don't have an honest desire to improve it for if you did you would want to examine the system so you could try to foresee any unintended consequences - and thus try to prevent negative ones. Since you are not attempting to understand the effects of your proposed changes you cannot in good faith state it will be an improvement. Instead you propose a change for change's sake without investigation, understanding, and lacking all due diligence required for a suggestion of such magnitude.
In short you happened to have an idea pop into your head and it sounded good at first and that is all the farther you thought about it before you thought about suggesting it. Then because its your idea and you have an emotional attachment, when that idea is faced with realistic criticism and questions you seek to attack and belittle rather than think.
Because there are plenty of idiots out there who will pay it?
Yet another example where Americans need to take a good look at themselves. Sorry Im not qualified to give any better answers. I drive American vehicles, and buy American made household products locally when posible and online when not. Our local stores around here don't "roll back the prices" but then again they dont sell shty imported products either. for the most part the local retailers have higher morals, they have a set retail markup, pay decent wages and provide insurance to their employees rather than making the tax payer pay the tab. The christmas toys we bought this year are of good quality and will be handed down to other children, and that is why I don't mind paying a little more and buying a little less.
As far as voting with your dollar, that vote was cast over the last 3 decades, and look what we got! A bunch of cheap imported crap and no jobs.
We have had great employment over the past 30 years, it is only in the past 3 years, since the recession started, that the unemployment rate has gone up.
The majority of Americans have voted via their dollars and like the idea of quality goods at cheap prices.
Oh it only took three yrs, ok my bad.:\
What does "my bad" mean.
do the businesses you shop at display their invoice price ? how do you know how much they mark up their prices ? if they are so honorable and considerate to their customers and employees .. why do they hide the truth .. ?
You mean wholesale price? Actually my family owned business is a vendor to the local grocery stores, so yeah I know what the standard retail markup is for them, I have to provide a wholesale price and suggested retail price just like any other vendor.
Gas stations don't provide the wholesale price on fuel, but if its .20 higher than everywhere else there is a good chance some of that is profit.
Things are only worth what people are willing to pay for them. I mean if we are willing (albeit grudgingly) to pay exorbitant prices for things, or do business with institutions operating in a way that is not in the interests of the public, whos fault is that? -BuyerBeware-
so, dont buy it. Vote with your dollars. If people just change their minds we drive their stock price to zero, by identifying a rogue corporation or bank, and simply choosing not to business with them, we crash their stockprice and bankrupt them. done. The power of a truly free-market is a direct extension of the peoples collective will -SoBuyerBeware- Its more powerful than any group of politicians.
a w a r e n e s s is where its at, freespeech, and unobstructed free flow of information.
I'll pay more for American products first EveryTime that I see the opportunity to do so, but a rouge institution is what it is and should be identified so that consumers are aware of what they are supporting.
but if everyone stops buying that would worsen the economy .. manufactures would layoff .. etc. etc.. no we need to get the government involved to control profits with a cap .. than the consumer can shop and shop all day .. doing great things for the economy ..
then i suppose we 'afford' them that right... but I think other more efficient companies offering a better product would rise to take their place. More competition in the private sector would sure help, too.
They deregulate the Big Guys and clamp down on the small guys.
well .. American Capitalism is going to hang onto the right to unfettered profits just like they hung onto slavery .
We are not living under capitalism. The free market has been broken by 'too big to fails' ...high frequency trading, derivative-delirium, obscene bank deregulations, extending and pretending, peekaboo accounting; playing hide-the-debt.... These are all distortions. (We wouldn't even recognize a free market or honest capitalism today)
Meanwhile these technocrats/bankers have captured congress, the senate & the executive branch with campaign contributions. Adults call them bribes and payoffs. They earn their brib... er, campaign contributions by pushing legislation through congress for the technocrats/bankers to deregulate further. What was illegal is now legal. ~cha-ching~ Thats crony capitalism. There is a clear difference between capitalism & crony-capitalism.
Crimes are going unpunished. So the crimes are Increasing in magnitude and frequency.
However, for those who imply that -true- free-market capitalism -Is Bad- (Where there is accountability and fraud is punished) I suggest you Do Not speak out about the banks or bailouts or question how sweet their profits are, because bailouts -destroy- free markets, and thissupports your cause. The banks are already Destroying capitalism for you!
Bailouts -IS- fascism. Bailouts -destroy- competition. Bailouts distort truly free-markets, because bailouts are propping the stock price of bailed-out institutions, keeping them artificially high.
Letting the insolvent banks fail is the Opposite of economic slavery.
We would have an honest market if the attorney general & proper agencies were doing their job. If they were indicting the criminal-class bankers and fraudsters. Thats where you find the REALLY big numbers. The REAL malfeasance. The REAL infractions. The Most Abuse.
The activity of these bad banks/corp/institutions bad behavior should not be 'remedied' by punishing the innocent by imposing profit limits on the legitimate majority, the 99.
Its crony capitalism these days, and can be remedied in one minute with a wave of the attorney generals pinky toe. But unitl his pinky toe does the twitchy thing and gives the signal, the media will stand down, and so the public will continue to go along with it all, the banks will continue to pillage and rape, and if the people complain about it, it'll probably be indefinite detention for you.
banks are included in this "Profit CAP" proposal. they buy and sell money at great profit .. addind burden on society and destruction to the economy.
as for bailouts , I understand your point .. but if you look at how the CAP functions you would see in retrospect those bailouts would have never been necessary..
I say reward the working man .. not the profit man. lets turn capitalism on its head .. and pay respect where it is truly due .. and not to banks or investors .. or middlemen.. but to the working man .. with skill and strength; our labour force.
hm, well the federal reserve prints money, then loans it to us at interest. How about we cut the middle man out and have congress (who can be held accountable/ voted out) print it again, at -Zero- Interest.
The money can be issued without burdening the people with interest. How much do you think that would save the working man? Lets put THAT money into the pockets of the working man.
I believe there is a proposal on the table on banking reform .. looks like you may get your wish ..partially..
interest free loans on a twenty five year mortgage would save the working man 150 %.. yes that would be very nice .. give the working man some time to enjoy life and not have to work longhard hours to fill the bankers pockets .. for what did the banker do again?
They have a right to "try" and make the highest profit.
From the consumer's willingness to buy. The truth is, profit isn't the issue. If someone wants to pay $2000 for an item, and they have the money to do so, let them pay $2000. If anything, I think it's the obsession with "cheap" goods that causes issues. Because that cheap price comes from two places - the quality of the item and wages of the employees.
The problem isn't the retailer earning a high profit. It's them choosing to earn a higher profit by exploiting workers, and getting away with it because those workers have no other available options.
yes profits is definitely the issue .. thats how the wealthy became so wealthy .. and why the economy is now in a crisis .. what is your issue ?
The problem is that without profits a business can't grow. If a business can't grow, they can't expand. Can't hire new people. Or decide to sell a new product - which would require paying people who make that product. Profits are essential in retail. Without profits, a retailer shuts it's doors.
Profits-over-Humanity is the issue to me. It doesn't matter that the wealthy are wealthy. It matters that a company or business owner does not pay their workers enough. A good economy doesn't just require money, it requires the movement of that money.
It's like deep-frying. Because the temperature is rising due to heat, and lowering due to the introduction of food, you end up turning up and down the heat to ensure things cook right. But at no point will turning off the heat be of any help.
first of all , there are two businesses that should not be under the same umbrella .
the manufacturing business.
the retailer business.
these two sectors are not the same people . one is skilled efficient and innovative , while the other is a bunch of thievs looking to live off someone elses back .. they hardly deserve to fall in the same category as the honorable manufacturer.
To hell with retail profits . Lets have governments owned and operated retail centers at nonprofit. this would definitly put the world back on the map.
Nice to know I'm a thief living off somebody's back...I know you don't mean me, personally, but please be more open-minded to those of us who work in this sector.
Retail replaced traders from more ancient times. We provide goods to those who have no other way to get them. (IE: food to those in urban areas, electronics to those in rural areas, etc) Retailers do add onto the price of the product because they have to pay for their own people and area. The price is essentially for the convenience. Travelling to get these items themselves is inconvenient, and sometimes not logical. (Several hours of driving to be able to buy fresh produce, milk, meat, etc. Most people don't have the time to do so) And in some cases, even more costly than buying it through a retailer. (Travelling expenses, shipping expenses, etc)
There are points when retailers cross the line, charging exorbitant amounts for a product that is unnecessary. But they do provide jobs and are a fundamental service of the modern world..
you are corrct retailers do provide a necessary service.
although when demand is high and supply is short I do not see how this entitles them to make extra profit. profits should be capped ..
Depends on the reason the supply is short. Did farmer's face a drought that lowered their crop of corn? Even though they didn't have as much corn to sell this year, the farmer needs to replant all his fields next year - to cover that cost, he should charge more for the lesser corn. The retailer, to still make their own profit, then charges higher.
This is logical and I see no problem with it. Now when, for no reason than because there's less, Store's mark the corn up to 800% of cost when they would normally only mark up to 400% of cost, then that is just greed.
But at the same time, nobody has to buy corn. They can buy broccoli instead. If they boycott the corn until the retailer marks it down, then the retailer learns a valuable lesson to be reasonable. Unfortunately, this is something people haven't learned to do. Or do for the wrong reasons. (ie - wanting cheaper prices on everything, even those that are high in order to maintain quality. I grow so tired of the - I got my shirt cheap! It makes me want to say - "Ya, but I've had my shirt for 5 years, and your will be destroyed by next month!")
yes but the farmer needs to raise his prices if the crop is poor this year to cover his expenses .. but if the retailer adds on huge profits .. than a boycott .. yikes the farmer is the one that loses .. and without farmers .. our grocery stores would be empty in minutes ..
so if we just Cap the retailer .. all worries are over .. the farmer adjust hie price .. and deserves every penny ..and the retailer gets their 2 cents on the sale ..
The farmer has already been paid. The store could not have his produce without paying him. A store does not get product without paying for it first. The boycott would only hurt the stores. And though my example was corn, there are plenty of non-food items that this could be applied to.
Don't forget that the retailer has a responsibility to pay their people a living wage as well (or should), as well as pay for their building, electricity, and so on. So 2 cents a sale is hardly adequate.
do you share royalties with the farmer if you receive high profits ?
That would depend on the deal struck between store and farmer. I imagine that in some of the smaller stores, it's possible. but unlikely. After all, a product like corn isn't the same as a product like a book, which can be resupplied on a consistent basis. There's a finite amount of the product to buy and sell.
Someone who produces clothing, however, might be able to make a deal with a store to receive royalties on purchases, since the supply would be infinite.
so than you oppose profit CAP on retail?
I feel that it won't solve the problem. Stagnation of money is the problem, right? Economy is only healthy when money circulates. Putting up a dam doesn't help if the river's drying up. We don't need a dam, we need more water.
better late than never they say..
putting up a damn is to keep water where it is needed .. and than it is controlled how much is let through .. just like a CAP would do .. great example
the stagnation of money you are correct .. but it is stagnating at the top more so than at the botttom which is circulation has slowed down .. the wealthy simply took too much profits .. they can not be counted on as economic regulators .. greed is to powerful to overcome .. we must use legal means .. we must regulate profits.
Cap their profits
that is the plan !
You are the man
capitalism is not the problem - if WE are stupid enough to let THEM develop monopolies,
if WE are stupid enough to let THEM send our jobs to china and india,
if WE are stupid enough to let THEM not pay tax,
WHOSE FAULT IS IT
WE are a product of capitalism. How can we expect people to make educated decisions when they are bombarded with propaganda and advertisements.
For corporations it's their fiduciary responsibility to their stockholders. The law.
So they can offer sales. There is one place here in North Carolina called Joseph A. Bank that sells men's clothes. They have sales every other day saying it is for one day only. "Buy one suit and get three more for free!". I always laugh about their ads. Why don't they just offer a good price ALL the time?
What right are you referring to?
Oil went from near $150.00 per barrel to less than $49.00 per barrel in less than a month for absolutely no reason other than the dollar spiking off and leverage being removed from the system as REAL capital vanished because one banks liability is another banks assets leveraged to infinity, until it isn't. That was a GLIMPSE into the TRUE price of oil. That $45.00 low it put in, in the middle of the freaking winter when MORE OIL is consumed in the US than any other time of the year.
Politicians have stated publicly that our debt does NOT matter. Well, they should be right, it SHOULD NOT MATTER, student loans should be defaulted and all Americas debts should also be defaulted. America has been the worlds policemen and ambulance for a long time now, and its time for the other countries to pony up and accept that not only is the US NOT going to pay back its 'loans' but it should NOT HAVE TO, just ask Germany did not pay back 1 mark of the money it just 'printed' in order to fund its war machine for WWII. YES, they DID have to pay war reparations, but they lost, and we won. period.
I friend of mine worked in Saudi Arabia, he said the price of oil there was only $2 a barrel when produced.
the price of oil at production is and has always been the same, extraordinarily low. its all profit start to finish as your not producing anything, just mining it and the costs to that are pathetically low
How about off shore drilling? It is very expensive, and difficult to do. Plus constant litigation from the environmental Eco nut jobs, drives obtaining oil through the roof. Also we have not built a refinery since the late 70's. It is very expensive to get the finished product. It is true oil companies have large profits, but the biggest profiteers from oil is our government with the taxes they put on to the product.
No, its not actually, whats it cost? Million and Millions per month? So? That is offset with the $50,000 well that pumps out millions of barrels. You must divide out the amount of money made to determine if it costs alot. It does not.
Okay, I see I am dealing with an Einstein. I give.
It's the refining squeezehole that is the problem. We don't have enough refining capacity, no matter how much oil comes to the ports. Without the refining capacity, the cost at the pump goes up when the demand for oil goes up. We haven't built any new refineries in the U.S. in 20-25 years, wonder why that is?
The permits required to build a refinery are under constant attack. The building of refineries in this country won't happen, due to the litigation constantly being filed against those that want to build. Blame it on the environmental wackos, and the people that regulate the industry.
Do you believe our debt does not matter?
of course i do, it matters as long as it exists in a form that other countries and banks actually think we are going to pay it off.
it would take all the currency printed to pay off the debt..
With the Fed which is owned by the big banks in charge of the money, things aren't going to change much until they are forced to change. see http://monetary.org for a plan and a bill by Rep. Dennis Kucinich to return the control of the money to the government, pay of the national debt without causing inflation and limit the Fed to controlling interest rates.
Can you come up a post on economics that isn't idiotic?
Because they can.
The have a fiduciary responsibility to their shareholders to perfom at the highest level of profitability that they can acheive.
The majority of your posts dance around the issues of Entitlement.
en·ti·tle·ment: Noun: 1) The fact of having a right to something 2) The amount to which a person has a right
Why is a surgeon entitled to more money than a janitor? Why is a retailer entitled to the highest profits possible? Who works harder - the rich or the poor?
An entitlement is a guarantee of access to benefits based on established rights or by legislation. A "right" is itself an entitlement associated with a moral or social principle, such that an "entitlement" is a provision made in accordance with legal framework of a society. Typically, entitlements are laws based on concepts of principle ("rights") which are themselves based in concepts of social equality or enfranchisement.
In a casual sense, the term "entitlement" refers to a notion or belief that one (or oneself) is deserving of some particular reward or benefit[1]—if given without deeper legal or principled cause, the term is often given with pejorative connotation (e.g. a "sense of entitlement").
Narcissism
In clinical psychology and psychiatry, an unrealistic, exaggerated, or rigidly held sense of entitlement may be considered a symptom of narcissistic personality disorder, seen in those who 'because of early frustrations...arrogate to themselves the right to demand lifelong reimbursement from fate.[2]
Narcissists hold unreasonable expectations of particularly favorable treatment and automatic compliance because they consider themselves special. Failure to comply is considered an attack on their superiority, and the perpetrator is considered an "awkward" or "difficult" person. Defiance of their will is a narcissistic injury that can trigger narcissistic rage.[3]
'John Murray (1964) in his/her now classic paper of narcissism and the ego ideal' laid great 'emphasis on narcissistic entitlement and the manner in which this reflects infantile pregenital narcissistic fixations' - something which led in turn to the 'notion of the "narcissistic triad". The narcissistic triad involves (1) narcissistic entitlement, (2) disappointment and disillusionment at the frustration of narcissistic needs, and (3) narcissistic rage'.[4]
Belief in the special, exceptional nature of 'narcissistic entitlement dictates that the patient has a right to life on his/her own terms...Such narcissistic entitlement plays a central role in borderline pathology, since the borderline sees himself as a special person with special rights and entitlements, such that any frustration of these entitled desires tends to undermine and often shatter the patient's self-esteem'.[5]
In the wake of Kohut's self-psychology, a valorisation of narcissistic entitlement might be said to have taken place, as 'the age of "normal narcissism" and normal narcissistic entitlement had arrived...[a] child's right and entitlement that its parents are obliged to proffer at the least the minimum requisite "self-object" soothing...to allow the infant/child to develop a sense of self-cohesion'.[6] ~wiki
does narcissism answer your question.
"Why is a surgeon entitled to more money than a janitor?"
He/she is not "entitled" to anything. The surgeon has a service/skill to sell, and people are willing to pay a certain price for that. But the surgeon cannot force you to buy the service.
Lol I'm not sure I want a surgeon who gets paid as much as a janitor to work on me.
I was making a bit of a jab at the poster of the question, perhaps he's narcissistic.
Oh, sorry.
It does explain their hot headedness
when i buy something from a retailer, i confer upon them a right to take my money!
take my money please!!
Its called a Fiduciary duty. Look it up
It's called revolution It's time we had one.
how does that response in anyway address my point?
its time for those of you who are mindlessly supporting OWS to think about things beyond the talking points given go you. You are almost as bad as those neocons who mindlessly spout fox news talking points... damn
to place fiduciary and retailer in the same sentence , is like placing a hat on a pig... faith and trust is definitley not related to the evil schemes and secrecy of the retailer.
They're moved to it by the invisible hand of mindless greed!
Does a right need to "come" from somewhere? And if so, what would give you or anyone else the right to question how much profit a retailer can make?
Where did the right come from to apply traffic laws and speed limits. When it endangers lives. It becomes everyones concern. High profits have harmed the economy and peoples lives.
Quite a stretch. If I have a widget that I want to sell, and I find somebody who wants to pay me a lot of money for my widget, I don't want the government to say my price is too high. The unintended consequences of the ripple effects of that kind of policy make me shudder.
You're trying to kill a fly with a cannonball, with no thought given to the other damage the cannonball might do.
That's why we have Anti-Trust laws to hopefully encourage competition which should drive down profits to the point that the buyer and seller reach a price that will allow both to survive.
I don't think they are being applied to imports by US manufactures in China.
high profits have no conscience ..and neither do retailers
Yikes! You want to start legislating a conscience? Married guys who flirt with girls have no conscience...you want laws passed against that? Film producers who glorify gore and violence have no conscience...do you want the government fining Hollywood for unacceptable film-making? And who gets to decide where the line is between friendly and flirty, and what scene is too gory, and how much profit is ok? Exactly how much power do you want to give to a government that you already don't trust?
Are you thinking this through, or just making knee-jerk comments like so many in this movement, that "somebody needs to do something." Geez, if you guys ever get any political clout, we're all in trouble.
if their wer no traffic speed limits do you think people would drive slow enough to be safe ? if they would than we wouldnt need limits would we. the fact is unfettered sales profits have destroyed the economy and many innocent lives. retailers need to be capped .. they are simply "going to fast"
Profits are already capped by competition. If I don't like what ralph's is charging, I can go to von's. As long as there is no collusion between the retailers, which is already illegal, the market provides all the caps we need. Getting the government involved will just make a mess. Again I ask, exactly how much power are you willing to give to a government you don't trust?
I think there is price-fixing by US corporations manufacturing in China.
The costs are much lower yet the consumers pay only slightly less than when the products were made in the US and the quality is much lower.
There were 38,000 price-fixing cases discovered in China last year alone so the practice seems very common.
This type of behavior should be investigated according to the FBI antitrust primer. http://www.justice.gov/atr/public/guidelines/209114.htm
I'm fine with the enforcement of current laws that protect fair competition so the market forces can work the way they are supposed to. I'm not fine with some bureaucrat sitting in an office somewhere and deciding arbitrarily how much profit is too much. That kind of government intrusion has disaster written all over it.
yes , anything imported makes a very high profit because its domestic competition is of higher quality and higher price .. so foreign prices are set just below domestice prices.. making huge profits on foreign inventory .. the retailers have killed domestic jobs with their greed
we need to cap profits . it's the only way to correct the system.
Geez, you talk like a robot! I'm stepping out of this thread - I would thank you for the exchange of ideas, but I'm not sure there was one.
when you are ready to see the whole picture we can try again
Lol! I should have the "freedom" to go 140 if the market forces and my brilliancy earn me a supercar! NOT!
140 mph ? through schools zones I suppose too ! whereever you want to drive at any speed .. it is your right ...
seriously .. why do you think there are speed limits .. to prevent danger .. and we need GREED limits to prevent harm to the economy .. the retailer has no concern to the damage they do .. they would drive 140 through a school zone .. if it was their right ..
"Where in the CONSTITUTION does it say I have to go 15 mph in a school zone? It is UNCONSTITUTIONAL!" "It should be up to the states to decide if it is ok to go 140 in a school zone." LOL!
Safety is everyones concern.
sorry to use the example of a school zone .. this may have sad feelings/ memories to those whom lost loved ones ..
Safety? Like "general welfare"? Look, I agree. Why are you apologizing about using a school zone as example? No matter. Have a nice day today.
Why question "retailers" without differentiating between sole traders / small businesses AND The Corporations ('Walmart' et al) ? Who posts SH!T like this and why ??!
High profits are destroying the economy and peoples lives.
I asked elsewhere, what profit would you find acceptable? The net pretax profit margin for most retail businesses is about 2-6%, depending on the goods sold (luxury goods at the high end, office supplies and things like that at the bottom). Walmart's net profit margin is around 4%. Is that too high? Can you provide a profit figure that would be acceptable?
your figures do not represent the actual profit margin of goods sold ..
Please explain. Elsewhere you brought up a different value, the markup, which is not the same as profit. I thought your concern was about retailer profits. You can find the profit margins for various businesses pretty easily. As I mentioned, Walmart's net profit is about 4%. If that is incorrect, please show me the real values.
Probably the manufacturers are making the bigger share of the profits from the goods sold at Walmart's, otherwise why fire their US workers and move their factories to China?
Most likely, though it probably varies a lot depending on the type of product. Everyone in the supply chain, from manufacturer to retailer, picks up some profit from it. I think the VAT (in countries that have it) tries to address that, by taxing the supposed "value added" at each stage.
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Really? The profits I make from selling my skills have certainly not destroyed me. They've helped me quite a bit actually.
It's the system we operate under. As long as there are willing buyers the retailer is free to sell. It's the buyers that have the control.
the buyers do not have the control .. !
the buyer buys out of necessity ..
For some things that certainly true. For many things it's greed, vanity, indulgence or a combination of all three.
desires are not rights
Just curious as to what items of necessity are being over priced? Food s dirt cheap. Gasoline is dirt cheap. Clothing is dirt cheap. House prices are dirt cheap.
What is over priced?
Where in the Constitution does it say they cant?
The constitution was built in the beginning of a brand new world. And while they tried to establish a perfect system. They failed in some arenas. And were successful in others. Of course failure and success is in the eye of the beholder. If I were to offer retailers a gauramteed 100% profit on all merchandise. They would take it without hesitation. And without consideration for the buyer or the economy. So their right is my wrong. Understand.
Because they DO have that right. if you don't like it, shop somewhere else. Competition is the only thing that creates decent pricing.
I don't see how having the right to make the highest profits possible could possible create decent prices ..
Because you are an idiot. That doesn't create decent prices. What creates decent prices are companies competing for your purchases. This causes them to drop profit margins. If American Eagle suddenly jumped to a 300% profit margin, people would probably just start shopping at A&F for example
thats like having the wolves fight over the chicken coop .. doesn't give any comfort to the chickens ..
It has worked great for years, why should it stop now?
worked great for whom ?
Everyone, essentially. Look at walmart. Even now they have ridiculously low prices on lots of things.
too little too late .. the already killed the consumer along with the job supply .. and without them .. who is going to buy any more of their junk ?
Supply and demand. If you want it and are willing to pay the asking price then that is the price. If it sits on the shelf for a long period of time, the price will drop. That's the system. Retailers can only make money if people are buying the products and adjust cost to match demand.
Thats true, and it will drop in price even if they have to replace it with a product of lower quality. But that square foot of space will always turn the same profit or even more!
when demand is high retailers raise their profits .. how do they justify the extra gain ?
If people continue to buy it at the higher price, they don't have to justify it. It is self justified by the fact that people keep paying it.
self justified ?
In other words, it justifies that price by virtue of the public still paying the higher asking price.
in most cases the buyer can not purchase directly from the wholesaler .. the retailer is insured of the sale at his mark up. where is the virtue in this ?
This isn't a question of virtue. Price and profit margin are a way to allocate goods and you want the most perfect source of information to make this decision and this means the public.
The argument tinhorn is trying to make is that the buyer has a choice .. but I point out the retailer has made it so the buyer can not in most cases buy from the same source as the retailer .. so where is this choice? the retailer has removed the most important choice .. I see no virtue in this .. but dishonorable treachery
Actually it is the wholesaler not selling direct to the consumer partly due to the fact it is unethical to take business away from a customer. The wholesaler or producer uses the retailers store front to sell a product. If you were growing and packaging beans and wanted to sell them you would sell them through a retail outlet rather than build stores all over town selling just the one item. I know what you are getting at with this article, and would agree if you hadnt included all retail stores. Walmart is making the profits! Smaller local businesses are simply taking care of overhead and taking better care of their employees.
Anyone can buy wholesale, you just have to buy a truck load of the same thing is all.
a truck load..and/or be a licenced retailer in some cases .. not ?
and the consumer is left out of the " ethical equation..
Jesus Christ what a pair of dense motherfuckers! You and Jflynn64 can go back to your crack pipes now! A wholesale warehouse is not going to sell you one fucking can of beans. And as for the tard below, who fucking cares where you buy an airline ticket and what the hell does that have to do with this thread? Forget it. Im done wasting time with you.
Only in a perfect monopoly can the retailer have that much control. If you want to bypass the retailer and go straight to the manufacture that is your choice. I will not purchase an airline ticket via Orbitz when I can go to United directly.
yes but can you buy the sofa from the manufacturer at the same price the retailer would pay ? or perhaps not allowed to buy it at all from the manufacturer .. on preconditions of the retailers agreement with the manufacturer .. protecting his monopoly on you
Maybe or maybe not, my price is probably going to be much higher than Walmart since they negotiate volume deals with the manufacturer. If so I am better off going to Walmart to get the same quality good at a lower price.
does walmart offer transparency as to the exact price they paid ? why do they hide this from the customer ? and if they told you would you believe them ?
No, they don't have to and why should they. It all comes down to the "good" that I am receiving for the money that I pay them. It doesn't matter whether I believe them or not.
well than perhaps you could have paid a less price at the manufacturer .. if it were allowed .. but usually this is not allowed .. which gives the retailer the upper hand.
Maybe I could have received a lower price but if a retailer is garnering a high profit margin then usually a competitor will enter the market to "steal" away that profit margin.
But in most cases the purchase is not a need it is a want. If the person doesn't need it but still pays the price then the price is justified.
if we place a cap on retail profits and it brings the economy around , we would than justify the CAP correct ?
To justtify a cap on retail profit is to go directly against the American way.
even if it saves the ship from sinking .. ?and provides a well balanced correction to an unbalanced economy..
You can use the same argument that people use against detainees in GITMO. There argument is that if we treat these terrorists any different than we treat an American who is in custody for a crime than that is not American. You are suggesting that we give up an equally important moral in our country to achieve a goal.
Lets look at the "American way " The revolution was fought because the king was taking too much profit .. even though the king felt it was his "right " .. thats the American way .. to stand up for injustice .. in the face of certain danger ..and have the honor to defend justice .. so the American Way that you try to hold up as your defence is really your down card .. for the American way will put you down on the very same principle they fought the king .. ..The American WAY
But that is not what you are talking about here. You are talking about taking the American way away from some to give to others. That is not even close to seperating yourself as a nation from a tyrant who wouldn't even recognize you as a citizen of his "Real" country other than making you pay taxes. You are suggesting in your posts that we kill free enterprise and that is a cornerstone of our way of life in this country.
it is not the cornerstone .. freedom is the cornerstone .. monarchy was ended .. and tyranny .. which is really just another form of capitalism .. the founding of the American nation was not supposed to repeat its predecessors ways .. that was corrupted by the founders ..
Freedom is the cornerstone and you are suggesting that taking the freedom from a store owner to have as a successful buisness as possible by regulating the amount of profit he/she can achieve because someone else doesn't like the price.
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What gives you the right to be paid more than minimum wage for the rest of your life?
You have the choice to not buy from a particular retailer, or not buy at all. Competition is important because it always forces prices to be competitive. Their is always a balance, between what one is willing to pay, and where pricing is set. The gas station down the road that consistently charges 10 cents more per gallon, does not get my business. I believe he charges more because his station is easier to drive in and out of. So a person does have a right to charge whatever he wants, but if it is too high, people will buy from someone else.
and slaves have a choice too .. they can run away .. where would they run too ? and to get caught was severe punishment .. so really .. they did not have a choice after all ..
Your argument is bizarre. We have not had slave trade in this country for 150 years. The only slavery we have now is people tied to the government for a welfare check, or other so called entitlements. These entitlements are nothing more than incentives for people to vote for the hand that feeds them. It works quite well as the number of people on assistance keeps growing, the democrats are more likely to get more and more votes. We can see this in the people's republic of California. That once great state is now buried in debt, and a chronically elected left wing government is constantly in power.
we do not have a choice .. we can not buy from the wholesaler or manufacture .. the retailer has agreements preventing that .. we are treated as subhumans .. and are forced to buy from retailers ..
You are a damn whiner. If you don't like buying from a retailer, go down to the second hand store, go on craigslist or eBay, or shop in the local markets and shoppers guide, and hit the neighborhood garage sales. Grow a garden, or just get creative. Sheesh. "Where does the right come from"? It comes from our constitution and bill of rights. Read the damn thing and quit this dipshit posting until you have read it!
my right comes from the first amendment.
Why not just stick to straight discussion. Speak plainly, please. Tell me what plantation you live on and who your owner is, please.
I am a runaway slave. I once worked very hard .. but my master took all the profits .. I felt that was unfair .. and tried to take some of the profits .. but was not allowed .. told it wasn't my "right" ..so I ran away ..
Because they have a lot of people to pay. From the guy stocking the shelves to the government, to importers/exporters, to the manufacturing facilities. It's not a right, it's responsibility.
we need to cap sales profit s, this will repair/restore the economy
Why?? If there's a cap on profit, then there's no reason to do it. It won't restore anything. Companies would leave the country, and we would be in a worse hole than we are now
there will always be a demand for products .. in this country .. and therefor retail outlets will always have business .. especially at capped profits business will improve .. in volume.
perhaps you are unaware . the cap does not apply to the manufacturing sector .. only the middleman will be capped at a percentage.. between price paid and price sold.. this percentage will reflect federal interest rates.. when rates go up cap will also go up .. when fed rates drop .. caps will drop ..
There's a demand for things every where. If you cap the middle man, then you're really jamming things. The companies don't want to deal with the public, and neither would the manufacturers, because the middle man would leave/quit. They don't make a whole lot of money on each sale either. On the smallest scale, ask someone in retail, what kind of money they make before their commission. If they break through the cap, why should they work till the next cycle for little money?? What if they do a good job, and break the cap in a week?? Should they be broke until the next month?? It's the same on the corporate scale, except it's more than just one person who has to keep sales going. Factories could be shut down, sales people may be forced to leave or take a part time job. It just wouldn't work.
the cap is an allowable percentage on each sale .. it is not an overall limit.. just to clarify .. and since the cap will lower prices sales will increase .. the amount of profit in this case is truly unknown .. depends on sales volume ..
As in "you can't charge more than 50 per cent on a 5.00 (to produce) item"?? Even if that were the case, what if prices in healthcare go up, due to advances in tech?? Cost of living?? Education?? The bills for the workers increase, they need more money, so where is the company left when they max out on, say a good year, but are looking at a tight quarter coming up?? Somethings gonna have to give.
as cost of living goes up so will the manufacturers prices go up .. and the retailer earning a percentage will see an increase
example $5.00 item with 50% markup would bring the retailer $2.50 .. but ifthat item increases due to cost of living to $6.00 , now 50% would bring the retailer $3.00.. does this answer your question?
That's basically it, yes. The manufacturer's and retailer's profit wouldn't be that much more. Remember, they have to cover the expenses of them(renting whatever locations, upkeep of facilities, etc) and their people(as in the humans). Don't forget about fuel costs also, 'cause this stuff has to get moved somehow.
Now if you take those figures and apply it to your floating cap, you will see there (at some point) will be shortages, some gains, and some flatlines. We will, for this example, take away the the gains and flatlines. You will now see some spikes showing the losses. Then there are location issues. Some areas are rich while some are poor, where would your cap sit then?? Because once the rich areas find out they can get the same product cheaper if they go 10 miles down the road, they just might do it, which would artificially raise the price of said (5.00 to produce, 7.50 to sell) product.
If you want to see what some retailers actually make, if you happen to be at a RadioShack on delivery day(and they're cool enough to show you), they have an inventory sheet, which tells you how much that store spent to buy it from the manufacturer (I know this, because I used to work at one). Some times, the manufacturer's price would go up(say, for batteries and higher volume, or big ticket things like cell phones-we'll get to those in a minute), but the price for said item would stay the same. Then you have some items like cell phones(see) where the retailer loses quite a bit. You know how you can get a smartphone for real cheap or free if you get a plan?? Well, the store ends up paying out up to ~650 for a $200 phone. The free ones cost no less than $150. You would still get the commission on the true price of the phone. I was a good salesman, but due to my location being right down the street from a major mall that had a RadioShack superstore, some months were better than others. So if this floating cap happened during a downtime, not a big deal. If it happens during the height of a season, thee could be a severe impact. In the end, to cover costs and not take a huge hit, everyone would have to pitch in. If they all got raises to cover, it could potentially slowly bleed the company to death.
I hardly have any concern for the welfare of the middleman .. he can squaller in poverty would be fine with me.
I was a middleman. Does that mean I can live in poverty, and that's okay?? I wasn't making as little as a waitress(on the hourly, they get crap), but it wasn't nearly enough to do anything but pay bills(maybe).
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They will stop making profits when you stop buying their products.
Why do you feel they don't? Who are you to say what is too much profit?
well its a big picture ... narrowed down to the smallest point.. Sales profit is the root cause of our current economic crisis
Please explain that statement. How are profits on sales what caused our economic crisis?
okay briefly.
sales profit includes retailers , banks , and investors.
look at the top wealthiest people ... they have accumulated so much wealth .. and how ? it was through profits .. unfettered .. and now they sit on that wealth and do not spread it around creating no work .. and without work the economy crumbles ..as we now see an economy crumbling..
It was through profits that money was taken out of circulation .. and since no one can afford to borrow more money .. resulting in an economic slow down .. had those profits been capped at a low allowable limit ..our economy would be currently doing well .
It's called TAXES!
The rich don't pay much in taxes since most of their wealth is from capital gains and dividends which are taxed at a lower rate than income taxes. Even capital gains aren't taxed until the stock is sold.
So then, you raise them
But how is curtailing their profits going to put more money in the economy? I don't mean to be a pain,just trying to understand your viewpoint.
Sales profit Cap = lower prices = increased sales = increased jobs = increased tax revenue= problem solved
a sales cap leaves money in the economy where it is ment to function. currently the piled up profits at the top is money taken out of the economy .. are you seeing the picture ? a cap would have prevented the money from piling up at the top which has caused economic crisis ..
Sounds logical I just don't know if giving the govt. that kind of control is a good thing. It seems to lean toward socialism I think.
well scosialism may give power to the government .. but in a government such as for the people by the people this power is controlled by everyone .. but in capitalism .. if we leave the power to make decisions in the capitalists hands , than we the people have no control at all .. which would you prefer?
But we are all capitalists in a sense. Myself I prefer the freedom to make as much as I can/want/need in the capitalist system.
if you were a carpenter out of work right now and the bank has forclosed on your home .. even though you are willing to work and work hard .. perhaps than you would question capitalism and the promise of its greatness
I don't think so. Why would I have any right to my home if I couldn't pay for it? I was actually given notice that my contract was cancelled as of Dec. 31,2011 here where I work now. When my old boss heard about it he called me and I will start working for him again Jan 1,2011. I've worked hard over the years to acquire skills that will remain valuable and in demand for many years to come. All I have I worked hard for and paid for. To me capitalism is great. I went from a poor kid on welfare to a skilled technician through hard work and my pay has always gone up and never down.
well , do you have any concern for those out of work and out of home in your own country ? or is america truly "dog eat dog" selfishness is as selfishness does.
Most certainly. It's why I give to charities,volunteer,and became a Freemason. I know what it's like to be really hungry,know what it's like to spend Ohio winters without heat. My "perspective" being such as it is, I believe gives me better insight than someone who "hasn't been there". I believe in giving a hand up and not a hand out. I'm proud that I have achieved what I have and I know that others can do the same.
there is no justification for unfettered sales profits. and since this practice is proven to be harmful to society it must regulated.
Proven by who? Did someone do a study? You see if something is priced too high people won't buy it. Too much drop in sales would result in a price drop. I don't think I'd like living in a country where the govt. tells you how much money you can make.
It's called " legal theft ". When someone takes more than their share it is stealing.
Is it "taking" or "giving"? When I go to a retail store, I decide if a product is worth the price to me, and if so I "give" money to the retailer and the retailer "gives" me the product. Of course the retailer "takes" the money from me, and I "take" the product from the retailer, so I guess you could look at it that way too. Semantically though "taking" seems to imply forcible seizure, and in every case I can recall, when I have purchased something from a retailer I have voluntarily reached into my pocket, brought out some money, and given it to the retailer. So I am not sure "taking" is the right verb. (It does apply to taxes, though, in which case money is "taken" from your paycheck against your will.)
its taking .. the retailer "takes " more than their share ..
So who determines what "their share" is? You?
Yes. That is what leftists say. They want the government to determine whatever profit a business can eke out. Somehow they think that a left wing/Marxist government (same thing really) is incorruptible and can determine what will make everyone happy and peaceful.
Letting the market limit the profits through competition is easier than having the government try and do it.
I think that price-fixing is being applied to products made in China due to the fact that costs are much lower yet the prices are only slightly less then the prices when the products were made in the US while the quality is much lower and profits are much higher. Not much competition there.
The FBI Anti-Trust primer says these are indicators of price-fixing and they should be investigated. http://www.justice.gov/atr/public/guidelines/209114.htm
A strong government is needed to enforce Anti-Trust, a weak government that can be bought will succumb to pressure from the price-fixers and fail to stop price-fixing leaving consumers with their wealth drained.
It's all about the tax. If you own a company and get profits with a low tax rate then you take the cash. Same company with high taxes. You grow the company instead of profit. This means your wealth grows without being taxed. The government has let the tax rate drop and the rich are taking their cash.
I agree about anti trust enforcement.
If you don't like the price shop somewhere else.
When prices are fixed there is nowhere else.
Retailers set the price for their products. If people like the products they will pay the price that the retailer is asking. What part of that seems hard to understand?
Retailers set their price for products based on what they pay for the products.
I think price-fixing is being applied to products made in China due to the fact that costs are much lower yet the prices are only slightly less then when the products were made in the US while the quality is much lower and profits are much higher.
The FBI Anti-Trust primer says these are indicators of price-fixing and they should be investigated. http://www.justice.gov/atr/public/guidelines/209114.htm
Your question is one of morality and ethics NOT rights. Your posed question is equivalent to: Why do people living in America feel they have a right to "drink beer". Drinking beer is not a specific right that any adult has (excepting age restrictions etc), it might be considered a privilege, a moral necessity, or a question of ethics for some. Drinking is simply an implied right that all adults have and it is only subject to control by morals and ethics - unless that implied right comes into conflict with the rights of others (safety on the highway, etc) which in or of itself is a moral-ethic decision.
Retailers say it is their right.
It doesn't make any difference what retailers say any more than it makes any difference what you say. Retailers have an implied right to price their goods as they see fit. What controls the retailers is the market, supply , demand and the willingness of consumers to pay the prices they quote. If you have never seen a "going our of business" sign, then you can assume that everything is in the proper balance - if you see that sign - then you know something got out of proper balance and that retailer will no longer exist in the market. (over priced goods, poor quality, poor service, shoddy stores, wrong location, etc). The only way to take this implied right away is for the government to place price controls on the retailer - is that what YOU want to see happen???? Perhaps instead of referring to it as a "right" which somehow implies a legal understanding, we should just call it a freedom (a freedom which can easily be taken away by the consumer or the competitor if the retailer wants to enfore their implied right and price at the greatest profit margin possible).
I think price-fixing is being applied to products made in China due to the fact that costs are much lower yet the prices are only slightly less then when the products were made in the US while the quality is much lower and profits are much higher. The FBI Anti-Trust primer says these are indicators of price-fixing and they should be investigated. http://www.justice.gov/atr/public/guidelines/209114.htm
When high profits devastate the economy than it becomes everyones concern. We need to cap profits to prevent devastation.
The tax of inflation by a heavily printed debt note is the problem. What you suggest adjoined the actual problem would destroy many if inflation accelerated rapidly, even if only a brief spurt.
no it would not effect the purchases already made . in fact it would prevent inflation in and of itself.
Wrong
the retailer buy sproduct from manufacture. and resells for profit . next week inflation causes manufacture to raise his price .. but retailer still has old stock" ..that is paid for at old price .. how would inflation hurt this ?
What chain of events happen when the Fed prints, or electronically creates, another 1 quadrillion dollars?
Would you also accept the government capping you salary or other source of income under some progam to balance all things (retailer, prices, wholesale prices, airline tickets, gas prices, individual salaries, get rid of unions and set government salaries, price of farmer raised grains, etc, etc etc)
Once you state capping one thing - there is no place to stop you know. You cannot cap a retailers prices and let the workers earn more and more while eventually the retailer goes broke.
Without a cap on retail. The retailers will take more and more holding out for highest profits possible. Destroying the economy by doing so. It's called greed and needs to be capped.
By the way, what profit would you find acceptable? The net pretax profit margin for most retail businesses is about 2-6%, depending on the goods sold (luxury goods at the high end, office supplies and things like that at the bottom). You can easily find specific data for the different type of retailers online.
the pretax profit margin ?
try showing us the actual markup of the product .. lets see complete transparency , and you will see profits from 200 % to 400 % and higher
That's not the same as the net profit. The seller has to pay for buildings, electricity, employees, fuel, transportation, employees, taxes, etc. What is left is the profit. So are you concerned about markup or profit? What profit margin would be acceptable to you?
I would like to see transparency on all mark up from manufacture to wholesale to retail to cutomer.. lets see it .. if the retailer has the guts to show this .. which I highly doubt they would ... because than everyone would be in an uproar ..if they knew the truth. of their greed
That would be interesting. It is not hard to find those figures online, though it would be easier if the numbers were attached to every item. But the law of unintended consequences reigns supreme in the universe. The average markup at Walmart is about 20% (of course there is a lot of variability depending on the type of product). A typical markup for a small convenience store is about 40%. So you might start seeing full page ads from Walmart comparing their markup to that of the Mom and Pop store down the road, adding insult to injury.
Anyway, I don't think most people buy things based on the markup; what is important to them is how much money is coming out of their pockets. If you go to one store that sells an item for $100, and the markup label says 50% markup, and then you check another store that sells the same item for $125 and shows a 35% markup, where are you going to buy the item?
well even at 20% or 40% that would be high interest rates.
although mark ups are known to be 200% and 400%. $125 + 35% = $168.75
I'm not sure I understand what you mean by interest rates. And as I pointed out, there is wide variability in markups. For example, a friend of mine has a painting that he got for next to nothing decades ago from an obscure artist. Today that artist is famous, and when my friend sells the picture there will be an enormous markup.
I am still not sure what specifically bothers you most - the actual price, the markup, or the retailer profit margin, and how you would approach a solution (other than markup transparency, which is a fine idea. I would also recommend more education in basic economics at the HS level).
compared with interest rates .. 20% is very high .. and thats what retail is .. they buy and sell for profit .. profit being an interest rate .. on their initial cost .
the mark up is the actual problem .. they are unlimited .. and this practice needs to end .. with limits CAP. they have no right to simple make more profit simply because everyone is working and the economy is booming .. what have they done to improve the economy .. there is no connection . but they raise their prices everytime someone gets a raise ...
as long as profits remain unfettered the working man will never see the light at the end of the tunnel ..
So your solution would be to put a cap on the markup, is that correct? What percent markup would be acceptable to you? Would the markup vary by type of product, or would it be one figure? How would you decide on a figure? For example, if a particular retail type has an average markup of 75% and an average net profit of 2%, would that influence the decision about the permitted markup?
I fear this would strongly favor the giant retailer over the mom and pop stores, since the Walmarts and the like can make profits on huge numbers of sales with a lower markup. It would probably be the final nail in the coffin of local hardware stores trying to compete with Lowe's and Home Depot. Small specialty and boutique stores (which need high markups just to pay their employees and survive) would be gone. Say goodbye to small jewelry stores. Everything would be sold by huge box retailers who could survive on lower markups through economies of scale. And since the biggest cost of any business is HR, in the face of decreased profits the retailer would need to explore how to better shed employees. Anyway, the Soviets tried to do something like this with the GUM superstores, and, as they say, the rest is history.
"what have they done to improve the economy"
The goal of retailers is not to improve the economy, it is to sell people things that they need or want. People are free to buy the stuff or not.
"but they raise their prices everytime someone gets a raise ... "
How could that be avoided? If the employees of the retail establishment get a raise, perhaps the only way the retailer can generate additional revenues to pay them is by increasing prices. I think that is a better solution than "right-sizing."
On a related note, you may enjoy reading about the wage and price controls imposed by Nixon in the early 70s. I have fond memories of sitting in line for hours waiting to get gas (I drove a GTO in those days and it was pretty thirsty).
It's not a right, Buyers pay what they believe what they should to receive the "good"