What i don’t understand that why the price goes up for finished products, it is already made, raw materials used and manufacturing is paid.
If the store already has 10 TVs in the store, why the price go up?
If you have a given amount of packaged bread already in the store why the price goes up?
Edit1: Lightbulb from many: Restock… You need to restock on current price, if you don’t follow the price you gonna lose money
However the “willing to pay” argument is kind of maddening, because with basic necessities like food “willing to pay” is reversed, controlled by seller and transformed to “have to pay and going to do so”
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So let’s talk extremes. If a store doesn’t have stock they won’t be able to sell it. And if they don’t have space in the warehouse for new stock, they can’t buy anything to place there.
So the price you pay isn’t strictly based on what the store paid to stock the warehouse. It’s based on a risk assessment of how much they predict they need to stock to sell to customers. If they predict more people buy than they are able to sell, the warehouse stacks up and they can’t buy new product to store at all – this is a surplus, and price gets cut often below the original wholesale price. You see this today with coffee grinders, printers, bread makers, etc. all the stuff that they had a surge of demand in a year ago and they placed new orders for, and now they have too much.
The opposite is true. If they predicted too little sales, they will need to pay more for new orders to supply the current demand. So they need to raise prices of existing stock to cover the additional unexpected cost of of new orders.
And in a supply shortage, the wholesalers charge more money, and factories charge more to the wholesalers for orders. So when the supply chain dips
Bad predictions over sales cause something called the “bullwhip effect” in supply chains. Prices will rapidly swing up and down as stores, wholesalers, and factories mispredict how much to make or stock of particular goods. That’s generally what we’re seeing today in the pricing of consumer electronics.
Additionally there’s the fact that people are willing to pay more when they need things and there are fewer available. That’s just supply and demand. Sellers exploit that to raise prices up and down the supply chain – if one store wants to sell TVs but there aren’t enough for every store, they will pay more than the next store for the same TVs and sell at a higher price. Because you the consumer buys from the store that has the TV you want, not the store that will get one in several months.
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