Prices Fall, Finally

As of late, the C.B.C.s website has been a major source for inspiration for my posts. This time, its an update about parity pricing. In the article, Prices fall though retailers warn deep cuts won't arrive until 2008 retailers are willing to finally bring some prices down. Also, they are willing to give discounts on most magazine and book prices. This has been one of the biggest concerns that Canadian consumers have been voicing their opinions on. This is definitely a good step forward.

As long as the Canadian dollar continues its rise or at least remains at a similar trading price with the U.S. Greenback, Canadians will eventually see some lower costs. But the recent high, described in Loonie closes above $1.07 US on strong job growth predicts an all time high of $1.10, which is definitely good for Canada's economy. However, our dollar has seen an increase against the U.S. Dollar, but really has not seen an increase versus other currencies. As a Canadian I am concerned about this. A lot of our goods for sale in the market are imported, and if we import from other countries, the exchange rate on those goods could be a great deal higher than the exchange rate between Canada and the U.S.. Right now, the U.S. Dollar is stronger against the Euro than the Canadian Dollar.

Another piece of good news, I have recently heard commercials telling consumers that prices are going down. It will take some time for prices to come down, but if its being advertised by retailers, it will happen. Thankfully the Canadian Media has been keeping up with the story and Canadian retailers are taking note. Nobody really wants to see consumers cross the border just for lower prices, but with reports of job growth on the rise, lower prices is more of a reality than a fantasy.

Granted that the job growth here in Canada is on the rise, we also have to look at producing more Canadian made goods at lower costs in order to sustain our economy. With an increase in competition in Canadian markets this can be achieved. I have studied economics, but I am no expert by any means, but increasing the supply of a good will help to bring down the price in the marketplace. Also there are many barriers to entry in the Canadian marketplace, if we want to sustain the current growth of our economy, more competition needs to be introduced. These barriers to entry should be reduced to encourage more competition into our markets.

Even though Canada has a smaller demographic in terms of population compared to the U.S., it is definitely possible to create more competition in today's marketplace. There are ways to gain entry into today's marketplace. The Canadian Government does have a program to aid entrepreneurs to start their own business, I still have to do some more research on this, but our government recognizes that we need to see more growth in our economy.

This is just my opinion and I do believe that Canada does have a roll to play in the global market place. Some of my suggestions could change the country for the good, but I am definitely not willing to run for political office. In the coming days and weeks, I will look at the larger picture of the Canadian economy, hopefully to gain a greater appreciation of the current competition and to look for little details that could improve our economy.

Parity Prices?

There has been a lot of complaints by consumers in Canada recently. C.B.C aired a special on Canadian consumers demanding a lower price. The special was called "Dollar for Dollar" and it included opinions from Canadian consumers. This is a good thing, because Canadians are finally starting to realize that the consumer can affect the price. Even the Retail Council of Canada has taken note. The Retail Council of Canada has issued a letter to Canadian suppliers to reduce prices.

Now of course there are other factors to consider when looking at the price of goods, it's not just the retailers that set prices. Manufacturers also set prices for their products. Also, Canadian manufacturers have higher operating costs than their counterparts in the U.S. which will affect the price of Canadian made products. Another thing to consider when looking at high prices, is competition.

Granted that the Canadian market is smaller than the U.S. market, but there are fewer and fewer competing companies. In addition to that, there are many barriers preventing more competition in the Canadian market. As well here in Canada, we have higher safety standards than some other countries and have to pay to make sure that a product is safe for sale on the Canadian market. Along with higher taxes, all these factors will be included in the price of a product on the Canadian market.

It isn't likely that we will see parity pricing here in Canada, but if more and more consumers start to stand up for themselves, we can effectively drive the price down. Canadian retailers do not want to see business go south of the border and are working to reduce prices. The Retail Council of Canada have a link on their website to a petition of sorts that will allow you to let the suppliers know that you want lower prices. This is a good thing and will help the Canadian consumer stand up for themselves and demand lower prices!

A note to Canadian consumers

I was taking a look at www.cbc.ca and found some interesting articles. The first one of note Canada will become one of the most powerful nations: Tony Blair, an article about a speech that former prime minister of Britain, Tony Blair made in Calgary, Alberta this past Friday. And the second one, Loonie briefly nudges $1.04US. Both articles show that Canada is getting more notoriety on the international stage. But even with these news worthy articles, Canadian consumers are still paying high prices for everything they purchase.

It is appauling that Canadian consumers have so much trouble sticking up for themselves. The worst part is that the consumer is supposed to control the market, not the retailer. You are the one with purchasing power, regardless of how much money you have, you still are the one who should be deciding how much you pay for an item. Recently I have stopped buying fruits and vegatables from my local grocery chain, instead, I go to a produce market, which is a specialty store. Sometimes in order to find better prices you have to shop around to find them. Now I wouldn't consider shopping around for the cheapest price being cheap, more like thrifty.

As a home owner, I have had to learn how to be thrifty. Especially when you are only supporting yourself on one income, when the majority of home owners are two income families, you have to learn how to be thrifty. Personally, I have a set amount that I would be willing to spend for an item. If the item is a necessity, then I would purchase it at the best price I can find, but if not and I can wait, I will look for a much better price and then purchase the item at the lowest price possible. I think a lot of Canadians have been too concerned with being called cheap while in school, it is during that time while you are growing up that you need to learn basic shopping skills. Sometimes you can be blinded by brand names or trends, but the bottom line is you have to look for the lowest price out there, that is why we have stores competing against each other.

Another reason for high prices is that certain markets are being dominated by franchises, and the old mom and pop shops are being reduced to a thing of the past. It is these mom and pop shops that help bring prices down, they encourage healthy competition in markets that are saturated with corporations trying to get you to spend every cent of your disposable income in their chain. If you want to see prices come down, look for the best price and support the little stores/restaurants that have to compete with brand name franchises.