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Should retailers slash prices?

post #1 of 18
Thread Starter 
With the rise of the value of the Canadian dollar (aka the Loonie), do you feel that Canadian retailers should follow Wal-Mart and Zellers by lowering the prices of their goods to reflect the parity between the US and Cdn dollars?
post #2 of 18
I think so , I went to buy a magazine yesterday, why should I pay $2.00 more. I didn't buy it. several people I know, are already doing their Christmas shopping online. It is much cheaper than paying canadian prices, even with shipping.
post #3 of 18
I guess if the retailers don't want to lose business they will.
post #4 of 18
A few dollars doesn't bother me as we have slightly higher import costs in many cases, but when things are double the amount and you can buy them cheaper in the US and have them shipped, it is wrong.

I definitely think they should be cutting the cost of items to reflect the parity of the dollar
post #5 of 18
I shop, mostly, on-line and I am noticing ALOT of free shipping lately.
Hurray for that.

I just ordered one of my dogs a bed today from L.L. Bean and they have free shipping on every order until December 21st. That are higher priced but their products are mostly made in America.
post #6 of 18
Yes, I do. Our dollar is worth 3 cents over the US one currently, yet I'm paying $15.00 for a book that can be purchased in the US for $8.00.

I think our Finance Minister should be getting involved and forcing companies to reduce the prices. It's criminal because these retailers are raking in the profits from gouging us prices based on a much lower dollar value from a few years ago. They should have been adjusting prices all along instead of ripping us off as they have been.
post #7 of 18
Originally Posted by catcaregiver View Post
I guess if the retailers don't want to lose business they will.
I know people planning trips to the USA to do their Christmas shopping. Why pay double when you can go and pay the same or less in the US?
post #8 of 18
I am sure in time they will, Right now there stock would still be based on the old price of the yoru dollar..

at least that is my guess.
post #9 of 18
well I hope some of you come south and spend here since many yrs ago a outlet mall built the last time this happened in my town
post #10 of 18
I feel that it depends on the products. I know that food products in Canada are different than in the US, for example, a box of Frosted Flakes in Canada has to meet a more stringent regulation than the box in the US even though the box looks the same. A different manufacturing process is used for the Canadian products because Canada has stricter regulations on food products.

As for books, our retailers probably paid more for them when they purchased them before the loonie rise but will also probably end up not selling them because we'll choose to pay less by shopping on-line or in the US. Since I'm an avid reader I'll certainly not pay Canadian prices for books that I can order from the US much cheaper.

As for clothing - I found some years ago before the loonie was at par that "quality" clothing in the US was just about the same price (after exchange rate taken into consideration) as the same quality in Canada. Same with shoes so now with the loonie at par, that would probably be a deal for us.

I just want to know how those shoppers are going to get all that Christmas shopping through Customs at the border.
post #11 of 18
Thread Starter 
Originally Posted by Yosemite View Post
I just want to know how those shoppers are going to get all that Christmas shopping through Customs at the border.
I've already done all my Christmas shopping in the US, and saved (according to my calculations) more than $500. I declared everything I purchased and only had to pay GST at the border because everything I bought was made in North America so it is subject to the Free Trade Agreement.

The only drawback was the amount of time I had to spend in cue to cross the border. But, I suppose 1.5 hours of my time is certainly worth $500 Cdn savings!
post #12 of 18
I went golfing in the US in September and I couldn't believe the queues. It seemed there were special lanes for everything - card holders, trucks, regular cars, and heaven forbid you get in the wrong line by mistake - nobody was willing to let you in the right line.
post #13 of 18
Thread Starter 
I guess the retailers are beginning to feel the pinch - Wal-Mart and Chapters both announced this week that they would lower prices. Wal-Mart will charge the US listed price on books and Chapters will offer 10 - 20% discounts.
post #14 of 18
I wish they were offering the same deals in store at Chapters, but I will take my 10% sticker happily anyway. Still a book sold in the US for $6.99 is around $9-10 here and considering the $ is higher, I would like to be paying the same as them, not more but less more, as the books can easily be printed in Canada without shipping from the US and often are anyway.
post #15 of 18
I see that so many people are ordering from the USA where the prices are comparable with our dollar, that Canada Post has a backlog of parcels and are even predicting a slow down in delivery of Christmas parcels if the trend continues.

The merchants here are shooting themselves in the foot. If they want a share of our spending money they better do the right thing and lower the prices to the same as in the USA so that we spend our money here instead of online across the border.
post #16 of 18
The cost of shipping from the US and taxes at the border can be high too, so it shows how different the prices are
post #17 of 18
Originally Posted by Natalie_ca View Post
I think our Finance Minister should be getting involved and forcing companies to reduce the prices.
Short of introducing legislation that ties and limits the retail price to the standing of the dollar, there's not a whole lot that can be done at that level. And that's a dangerous thing to do, because it will mean constantly fluctuating prices in our market, assuming the dollar doesn't hold at one point forever. This isn't so much a huge problem for Wal-Mart, but my boyfriend's family's restaurant would have a hard time having to change prices based on their customers' buying power instead of their operating costs.

People are looking at this very narrowly and we might have some very real economic ramifications because of it. Firstly, shopping in the US to get better prices is really going detract from fourth quarter earnings of CDN businesses. That's the obvious. So now, they're losing money, which makes it harder to drop prices. I'm not saying it's right, just pointing that out. Also, keep in mind that some products, like books, were printed and priced before the dollar reached this level, so they may very well adjust soon (new releases anyway).

But lowering prices is easier said than done. Unless costs are cut across the board, it's difficult to keep a steady bottom line and trim in one area. I'd also like to point out a very real danger to small businesses. We're talking about significantly cutting prices, but has anyone considered what that would do to the operating budgets of small businesses? Everyone is screaming that their dollar is worth more, but nobody is suggesting we adjust the minimum wage. If price limits were tied to the dollar legislatively, we'd likely see small business decreasing their production levels or even folding due (in part) to staffing issues once they're bringing in less but still having to pay their employees at the same level.

I'm for price adjustment, just not for sudden sweeping adjustment. I think it should have been done gradually, but a sudden change would probably have some pretty serious consequences.

Just my two cents (which is worth just as much as you Yankees' )
post #18 of 18
The whole idea is, that if costs decrease (and our groceries have always been overpriced compared to the cost of living in many countries), then the cost of living decreases and there is no need for a wage increase or businesses to lose profits.

Books were printed with prices, but that does not mean they are bought by the retailers at that time for that price, they can negotiate with publishers to buy them cheaper, at at present are making 6% on the dollar exchange. Why should that 6% go into the hands of the retailer and not be passed on to the consumer (or small businesses such as your BF's family).

I don't expect retailers to change their prices weekly in response to the dollar, but they are still operating by charging costs of when the loonie was 20c less than it is now, and it is evident by the backlogs Canada Post have that people are shopping abroad which will hurt Canadian business more than dropping their prices to a 'safe' level, as they will eventually have fewer customers, meaning overstock and not keeping up with their promised quotas from suppliers and they will sell everything at rock bottom pricing just to get some money.

The government have been looking into price parity and Flaherty made an announcement on Friday who did speak to the bigger businesses about lowering their prices.
Chapters-Indigo actually said in the announcement with Flaherty that dropping prices is better for business as it allows them to compete better in what is becoming a foreign market.
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