"John" wrote:

Next!!! - Ah the shop that sells stuff that costs a few quid to make is
marked at £100 and then people queue and fight over it when it is "reduced"
to £60.


Exactly.


If Primark can sell items at a certain price - then how much more should a
better quality item really cost? (given that they are probably made in the
same far eastern country on the same machines)? Using M&S as an example the
answer seems to be about 10 times more. The shipping and distribution
element would be the same.


Cheap Far Eastern manufacture has allowed some greedy retailers to
whack up their margins to levels never seen before. Whereas typical
mark-ups were in the 50% to 100% range, they became multiples of 100%.

When retailers found they could buy items at a tenth of the price they
were paying for UK-made goods, they didn't drop their retail prices by
more than a few per cent. As a result, their margins went through the
roof. M&S is a very good example.

The result is that shopping centres have become warehouses of cheap
Far Eastern tat often sold at unbelievably high prices. With cheap,
minimum wage staff, their major costs are rents, refits and the
marketing budget. The whole edifice has been hugely profitable for a
few years, but is on the point of crumbling into nothing because it is
totally dependent on moving stock that isn't selling except at deep
discounts - and that's the margin gone.

The guessing game of who will survive and who will fall by the wayside
is fascinating, but huge numbers of retail staff will lose their jobs
this year through no fault of their own.