Reeder already expects his prices to rise 2 percent to 3 percent for the next academic year. But he's not passing all the costs along.
"We're taking some of a hit on the profit end of it," he says. He's hoping to get another 10 to 12 customers signed for the next year; the added sales volume would help his profits.
Clothing stores are also contending with higher prices — and consumers' tendency to be frugal when they're paying more for gas, food and other items. Jimmy Au's, a Beverly Hills, Calif., men's store, has paid on average 5 percent more for the clothes it stocked during the past year. Alan Au, the store's client relations manager, says prices for cotton, wool and silk have soared. Top-grade cotton has gone up as much as 10 percent over the past year.
Au says the store laid off a sales person as demand fell, and that allowed it to keep most of its prices unchanged. It has raised prices on some high-end suits and on jeans that sell for $200. But for the most part, the store is telling customers, "we'll bite the bullet for you because we appreciate your sticking with us."
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