Retail Economics 101: The Balancing Act

Most of my purchases are based purely upon impulse. Here lately, these impulses have become less frequent (not really), but increasingly more expensive (really)!

As I understand it, during a recession, the goal for most retailers is to maintain their current levels of income or profit. However, this strategy might even be difficult, because input and inventory prices are rapidly rising (manufacturers, distributors, etc are also facing tough times). With this goal in mind and operating costs increasing, it is intuitive to raise consumer prices.

But, according to Meghan O’Brien,  Department of Economics at my alma mater,

…these increases cannot simply or universally be passed on to consumers…Pricing goods based on their elasticity is a smart retail strategy during a recession…the lesson for a retailer is not to raise prices on those goods that your customer can live without or go down the street and purchase in a less expensive form.

Managing inventories at a profit maximizing levels is difficult for retailers in a recession, but critical for success. The wisest retail strategy under the circumstances is to order the minimum necessary to sustain existing demand—an ample amount of staple items, which sell frequently, and fewer of those more expensive, non-essential items. Unsuccessful attempts result in reducing excess inventory via sales and losing consumers to competitors when there is a shortage.

 

O’Bien’s tips for shoppers:

1. Now is a good time to be a consumer. You might have less money to spend, but retailers want your money more than anytime in recent history. Take some time to shop around for the best prices and services.

2. Your dollar is your vote. If you really enjoy shopping at a local retail store, don’t expect it will be waiting for you to come back if you switch your spending habits.  Choose where you will spend you dollars based on whom you would most like to continue doing business with.

3. Be reasonable about where you travel to shop; try to maximize your savings per trip.

4. Limit credit card use. Retailers may be running great specials but stocking up at 70% off isn’t saving you money if the balance stays on your credit card for multiple billing periods.

 

O’Bien’s tips for retailers (among others):

1. Don’t assume raising prices will keep your revenue stream stable during a downturn. The price elasticity of the goods you sell will determine whether you can raise prices or not. DO NOT raise prices on highly elastic goods as this will reduce the quantity demanded dramatically! (emphasis added)

2. Listen to your customers; they are your greatest asset.

Based on the article Retail Economics 101: Lessons and Strategies of a Recession

 

Gone GaGa

It’s been a long time coming, but I have to admit that I am completely WOWed by Lady Gaga. I’ve been eyeing her style for a while now. Her appearance on last night’s episode of Gossip Girl, in which she performed “Bad Romance” rocking a 30-foot long red dress, was mesmerizing. The Bitch is BAD!

Her repertoire has likened to those of Grace Jones (have you seen this performce in Vamp?) and Rupaul. Rihanna might be her biggest competition. Beyonce is totally feeling the pressure. Did anyone else notice her sudden allegiance to the avant garde movement? Hang in there Bey. Ciara should just throw in the towel leotard.

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DIY Embellished Tights Project Update

Here is an update on the progress of the DIY project I started a couple of weeks ago.

Of course, I started by gathering all of the necessary materials: Tights, needle and thread, and sequins.

Then, I separated the sequins, because I couldn’t use all of what was in the bag. I decided on the stars.

Sewing wasn’t bad, but it seemed like every time I got in the groove, the thread would run out. Tip 1: use a piece of cardboard, or the like, to give the tights some structure while sewing. The cardboard also prevents the needle from going through the other side of the tights, therefore sewing them together.

Ta-daaah! So far good, but I do want to add a few more stars and some beads. Tip 2:  take some time in the beginning to figure out a color combination. In retrospect, I think I would have chosen to go with fewer colors on the stars.

 

Free People has some sequin-embellished tights here  for $88. Mine cost a total of about $20, not including labor. I will definitely post the final project.

You’re An Insider

Pss. Here’s a little secret. I have an internet-stalker-like suspicion that Forever 21 is going to have a pair of over the knee/thigh high boots online soon. You’d better keep a close eye on the site, though. They’re likely to go fast at that price ($44.80). Get your pocket-books ready!

I usually only share  juicy little tid-bits of  information like this with insiders. Today, you’re an insider. Ta ta, for now!

Tyra Mail! This is UnBeWeaveable.

Tyra Banks is will reveal her natural hair, ditching her weaves for the season 5 premiere of her CW talk show, airing Sept. 8.

This season on The Tyra Show we’re taking it to the next level and getting more real than ever before by encouraging women everywhere to own and rock what they’ve got and be proud!” she says in a press release. “For the season 5 premiere, I will be doing just that – no fake hair, I’m rocking my REAL hair. This will all be going down on September 8, 2009, which we’re declaring National Real Hair Day! We welcome everyone to go natural with me! -Source

On Twitter she wrote:

Guess What! I’m rockin’ my REAL hair on my talk show September 8th. No fake hair at all! Will be the hair coming out of my scalp! 4 all 2 C!

Then, she took it to the streets with her Flash Mob, stripping down to flesh-colored bodysuits and tossing away their weave in NYC’s Union Square.

 

Who does Tyra think she’s kidding?! This is all about ratings, folks. DO NOT take your hair off for National Real Hair Day. Take it off because you want to, when you want to. What does she mean, “getting more real”? Nonesense. At a point in history, Black women were said to wear weaves because they wanted to be white; they were denying who they “really” were. But, not anymore. A lot of Black women are proud of their hair and wear it natural and others are proud of their hair, but choose to wear a weave. It really comes down to convenience and choice. It takes a lot of work to maintain natural locks. And frankly, one day a woman might want volumous, textured hair, and the next day, long straight hair. And that is why (in my opinion) people, including myself, wear weaves. Convenience and versatility.  And for those very same reasons women of all colors have adopted wearing weaves.  It’s just another form of expression. “THIS is how I feel today.” Just like changing your nail polish or choosing which shoes to wear in the morning. Basically, “what do I want to present to the world today?”

There are still some ugly and mean spirited people out there, though. If you dare, check out some of the comments made by justjared.buzznet.com readers on the issue. I refuse to quote them here, but the readers implicitly and explicitly assert that Black women’s hair is inferior. Spread love people.

Tyra’s good at spreading love. And I hope she has a good explanation for all of this on September, 8.  Cause really, Tyra, “I’m taking off my hair. Stay tuned.”?

Am I missing something? Is there really an issue with wearing a weave?

My Love Affair with Pixie Market

 My heart belongs to American Apparel. Their 2% spandex really tickles my fancy. But my adrenaline starts to rush every time lay eyes on Pixie Market. Studded, mesh leotards!  Exposed zippers. Leggings. Hooded dresses with shoulder pads! The Their styles are very much on trend, very affordable and very much in demand. Every thing I want is SOLD OUT! It’s my new obsession.