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In a highly competitive sector How retailCompanies cannot afford Price gougingsays Target CEO Brian Cornell.
“We are in a penny business,” Cornell said Wednesday during an appearance on CNBC, followed by the retail giant’s strong quarterly results.
Cornell rejected the claim that Target raised prices to increase profits, saying retail profits are already minimal and every penny counts. Because shoppers have numerous options, including the “ability to shop in-store and online,” retailers have to be much more careful with pricing to avoid losing sales, Cornell said. He did not address whether other retailers had engaged in pricing. Price gouging.
Cornell’s comments came after Vice President Kamala Harris, who opposed high food prices, said she would Federal ban on price gouging by companies if he is elected president.
Retail executives have fought back in the days following this proposal.
“I thought we had learned by now that price controls don’t work,” Carlos Gutierrez, CEO of Kellogga former commerce secretary, said on CNBC on Tuesday. “They actually have the opposite effect. They create more inflation, they create shortages, they create a black market.”
Target beat Wall Street expectations in second-quarter earnings released Wednesday, thanks in part to price cuts the retail giant made in May. At the time, Target said it would Reduction in prices for almost 5,000 everyday items.
