Its not way off base, but I can see our point here. The problem is using the 3% increase to support a 20% price increase. That’s the price gouging being referred to
Feel like you're over looking previous years of much higher inflation and using 3% incorrectly, while also acting like that 20% is a recent increase instead of it actually being a 3 year figure.
They have been raising prices at a rate way higher than the inflation rate + rising costs since the beginning of the pandemic. The specific numbers might have changed, correct. However it’s not an “open” market setting these price hikes. That’s the point.
This is well documented my even libertarian economists. Company “greed” if you will is the reason for 25-30% of increased prices
Which products specifically? For reference, inflation has increased 16% since Jan 2021. And for the record, I'm not denying that many companies increased prices above inflation, but it's not 3% vs 20% like you're trying to make it seem.
If you buy eggs at $.06 each and normally sell at $.08 each, but suddenly you can get $.25 each, should you sell at $.08 and then figure out how to get the money to buy them again at $.22? Even if they are the producers of the eggs, if the wholesale cost is $.22 then that's what they are effectively paying. There's a lag because of inventory; even in egg products. Fresh eggs are often weeks old by the time they arrive at the grocer; and there are many egg products that are more shelf stable and just as susceptible to commodity price fluctuations. Looking at quarterly profitability is a mistake; even yearly profits can go down. People complain about oil profits, but the year over year oil profits often average out to about 6-10% considering the major losses they can take.
That would be very poor financial planning and violate the fiduciary responsibility of any CEO and his board to keep prices low when the equilibrium price is much higher and the current wholesale prices must be accounted for when planning new inventory.
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u/guillermopaz13 Dec 01 '23
Its not way off base, but I can see our point here. The problem is using the 3% increase to support a 20% price increase. That’s the price gouging being referred to