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Deflationary Toy Pricing

Tuesday Nov 9 2010

 

We are studying incremental decision making in ACCT 3314 and the chapter features Mattel. Well

WMT and TGT are battling it out.   Yep it is the race to the bottom for the cheaper alternative. This is real deflation no matter what the FED says. Incremental decision making usually involves ignoring existing sunk or fixed costs. No doubt both retailers are squeezing suppliers to cut their margins. 

Picture 2 Students will recall that WMT and TGT have been battling on book prices, now toy prices. 

And yes I rented Toy Story 3 Sunday and loved it. In a rare exception this sequel could be the best of the series as the gang is shuttled to the Sunnyside Day Care Center beset with kids disrepectful of toys, yikes, thrills, chills, narrow escapes, will the gang get out of this one, clearly a better deal than Stallone's Expendables. 

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One response to “Deflationary Toy Pricing”

  1. Phillip Garcia Avatar
    Phillip Garcia

    As the article said “Parents are always going to buy toys for their children during Christmas,” and I believe that the price wars between Retailers concerning toys during Christmas time will never stop. The face of a child on Christmas day is priceless. Retailers are motivated by profit; Parents are motivated by love and joy. Christmas is the biggest buying reasons for toys, Retailers probably make up the difference after and before Christmas when there are many children birthday parties and this is when the prices for toys go back to the normal regular prices. ACCT 3314 Student.

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