Odd Lots Companies Are Telling Us the Real Reason They're Still Raising Prices
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Mar 9, 2023 Samuel Rines, managing director at Corbu, dives into the puzzling persistence of inflation. He reveals how companies are prioritizing price increases over volume sales, a strategy evident in earnings calls from brands like Wingstop and PepsiCo. Rines discusses consumer behavior, noting the surprising willingness to spend despite rising prices. He touches on trends across retail, highlighting the dichotomy between companies like Target and Walmart. Finally, he explains the concepts of 'greedflation' and 'excuse inflation,' shedding light on corporate pricing strategies.
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Listen to Companies
- Economists should listen to corporate conference calls more often.
- Companies often directly state their economic actions and reasoning.
Price Over Volume
- Samuel Rines noticed companies prioritizing price over volume in early 2022.
- They accepted lower sales to maintain high prices and profit margins.
PepsiCo's Pricing Power
- PepsiCo raised prices after the Ukraine invasion to compensate for lost Russian sales.
- This demonstrates the "price over volume" strategy.