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October 21st, 2008, 03:03 PM #1Sticky Prices..."Sticky" Prices.
That's what analysts call it when companies slap higher prices on products and keep them there even though the rationale for the price hikes — such as soaring oil prices — is gone.
October 24th, 2008, 12:01 AM #2
in some segments of the market (shipping) the merchants are still paying rates based on last months fuel surchages from Fedex, UPS, DHL... while the price of gas could drop $2 tommorow the merchants are paying last months average fuel surcharge and even this months average will not be what we paid for gas yesterday. When the product has to be shipped overnight a lot of merchants got stuck in the middle this past year, since no one wants to pay $30 in shipping for a $40-50 gift.
To be fair the article also talks about merchants that ate the higher gas costs, but that has left a lot of companies with a lot less cash than may be needed for the coming year. It's really messed up the gift industry, a few big names have already folded.
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