The emails and letters from our vendors are starting to trickle in: “we’ve held our prices as long as we can” or “due to changes in trade policies, we regret to inform you that…” It’s been a while since we’ve seen across-the-board increases in wholesale prices, but higher tariffs usually mean an increase the cost of imported goods. Some of our suppliers are being forced to pass rising costs along to us, and we will probably have to pass them along to the consumer.

The timing on this coincides with Amazon announcing that it is raising its minimum wage to $15 an hour for all US employees, which is bound to have a ripple effect on what retail employees in all businesses expect to be paid.

What can you do?
1. Analyze all your expenses carefully. Higher prices may mean a decline sales, and higher wages means that payroll will take a larger percentage of your gross margin.

2. Evaluate customer shopping patterns so that you can schedule in a way that makes the most efficient use of your staff time while still maintaining a predictable number of hours for employees.

3. Take markdowns on older merchandise to free up inventory dollars for newer, better-selling stock.

4. Consider consignment as a way to add to your inventory without additional investment.

5. Source products not made in China. You might be able to work with artisans to develop some new products, which is a win-win for your local economy.

6. Stock up on best-sellers before the prices go up. Many companies will give you advance notice of a price increase, and it’s not a bad idea to order ahead if you can afford to.

Independent retailers have overcome significant setbacks in the past, and will continue to do so in the future. It is more important than ever that we project a spirit of optimism to make customers want to shop with us, and express our gratitude for the fact that their support makes it possible for us to continue despite these potential challenges.

Happy Retailing,
Carol “Orange” Schroeder