Surge Pricing

Dis86 said:
I'd be avoiding any place that did this out of principal.
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I guess that is the worry for some supermarkets when trialling this - there will always be the local cost cutter or grocery store, butchers and corner shop that people could head to instead.

Likewise some chain could make a big deal out of advertising that they don't use dynamic pricing but "promise to keep the same low prices, guaranteed" etc...

Overall though it ought to increase efficiency if implemented widely - it isn't like there's not fierce competition between supermarkets. Certainly the rise of supermarkets and increases in efficiency have overall lead to our food/shipping in general being much cheaper.
 
Rincewindle said:
So....

Your on a fixed income {pension etc }

You go into your local supermarket with this system.

You know what you can afford to buy based on the money you have left that week..

Get to the till and it has gone up by 2 - 3 pounds. not much to the trendies that shop in places like Marks and Sparks and waitrose.

But a single mum or pensioner... what do they leave at the checkout that they cant afford that week ?

Add to that the embarassment of having to do that with a queue of people behind them.

This just smacks of another way supermarkets are looking to squeeze money for nothing out of people
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roll over and starve seems to be the theme here :(
 
If you read around, the supermarkets are already talking of expanding it to other areas like fuel. Examples given would be you would be charged more if filled up in the morning / school run.
 
dowie said:
though there is currently a problem (especially in Tesco it seems) with staff being lazy and leaving out of date price labels on various items re: discounts/special offers etc...
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It's not just laziness though; sometimes a product isn't named correctly on the SEL, sometimes it isn't located where you think it should be, sometimes it's located in more than one location but the system doesn't know to print the correct number of SELs. I worked in retail many years ago, actioning price changes was horrible so it's good that electronic SELs will save people from having to do it.
 
TheVoice said:
It's not just laziness though; sometimes a product isn't named correctly on the SEL, sometimes it isn't located where you think it should be, sometimes it's located in more than one location but the system doesn't know to print the correct number of SELs. I worked in retail many years ago, actioning price changes was horrible so it's good that electronic SELs will save people from having to do it.
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I think laziness, sloppiness comes into it too - even when pointed out they don't always remove the labels in my local store. My example wasn't talking about printing new offers but removing the expired ones. Tesco in particular seems to have a problem here that you end up wondering if it is almost partly a decision by management that they don't need to crack down on this as various consumers won't notice the offer has expired and others will only notice at the till then you just need to refund a small % of people.

Yup dynamically updating prices could certainly save people from doing that job though on the negative side for them, perhaps in the case of a larger store, this then may mean they can get rid of a couple of staff members or need fewer people per shift. I wouldn't be surprised if the efficiency of staff members is more closely monitored in future too when re-filling shelves etc..
 
Vanquish-Storm said:
And then Amazon fresh comes along and you get your shopping delivered same day at the price you see. Showing the supermarkets how it should be done.
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Amazon are the Kings of surge pricing, they started it all off. They have all sorts of data on you right down to the value of your house and are rumoured to use it accordingly.
 
dowie said:
I think laziness, sloppiness comes into it too - even when pointed out they don't always remove the labels in my local store. My example wasn't talking about printing new offers but removing the expired ones.
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For sure, it definitely does but my point is that from experience, there can be a lot of reasons price changes aren't actioned. Whether it's a new offer or a return to normal selling price it's the same thing; when a price change occurs a new SEL gets generated and printed. If that batch isn't printed, or it mis-prints, or the SEL gets lost, or the other reasons I mentioned before, then the price on the shelf can end up being wrong.

dowie said:
Yup dynamically updating prices could certainly save people from doing that job though on the negative side for them, perhaps in the case of a larger store, this then may mean they can get rid of a couple of staff members or need fewer people per shift. I wouldn't be surprised if the efficiency of staff members is more closely monitored in future too when re-filling shelves etc..
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To be fair, the rate of staff turnover in retail is such that nobody would actually lose their jobs, they just wouldn't be replaced. When I worked at Sainsbury's the night shift workers had productivity targets, wouldn't be fair for dayshift staff though because they're frequently interrupted by customers.
 
Doesn't surprise me, they never have wanted to sell anything cheaper than absolutely necessary. For years some national chains have had regional pricing so they only lower prices where they have a competitor. The thing is you wouldn't know, you decide whether it's a price you're willing to pay at the time. Same goes for sales, people buy stuff at full price but then complain at the end of a season when things go on sale. You can't however be guaranteed the stock would be there for the sale if you hadn't bought it. It could have been popular enough to have sold through without going in the sale.
 
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Next will be dynamic pricing of petrol.

As you pull in to the petrol station with your car running on fumes the petrol station communicates with the computer in your car (for safety checks etc) and identifies your very low fuel status and bingo the price goes up for you - where else are you going to go . . .
 
Amazon have also opened some bricks and mortar supermarkets in the US where they don't have checkouts, it's all done with CCTV and a smartphone app. I can see them using surge pricing there, they know where the customers are as they're tracked around the store.
 
Great, give's me an opportunity to get ahead by going outside of peak times. I pretty much already deliberately go to Morrisons late on in the day when all the stuff get's reduced. Look at it as a discount for people who plan ahead.
 
Using the sandwich analogy how can you surge price an item that you have a given stock of?

How does that make any sense... If you have 200 sandwiches and sell 200 you get the profit from 200... Just because you sell 150 of them between a 2h period how can that have any effect on supply?

I'm sorry but this is completely bs.
It should not apply to shops.
Other services arguably? But even that makes no sense a lot of the time.
Demand is high so I can charge more? Because people will pay? Really fundamental principle of economics that make no real sense.

Profiteering.
 
Efour said:
How does that make any sense... If you have 200 sandwiches and sell 200 you get the profit from 200... Just because you sell 150 of them between a 2h period how can that have any effect on supply?
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Supply from the perspective of whom? If you've already sold all your sandwiches before you can resupply/restock them then you'll run out... customers who would have purchased a sandwich won't now be able to during the time your shelves are empty ergo you might have been able to charge more for them during that period of time.
 
dowie said:
Supply from the perspective of whom? If you've already sold all your sandwiches before you can resupply/restock them then you'll run out... customers who would have purchased a sandwich won't now be able to during the time your shelves are empty ergo you might have been able to charge more for them during that period of time.
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Problem is that it likely would be more profitable to have more stock in the first place and sell to all customers. The better stocked supermarket which can do this will win over one that attempts to vary prices because it hasn't planned for demand appropriately.

This isn't like seats on a plane where supply is very restricted and you want to squeeze every pound of profit possible.

Imagine this website, overclockers who do get restricted supply of stock of various things. How would it be more efficient to have prices varying throughout the day, instead of just setting a single price which ensures stock just sells out in time for the next supply.

Supermarkets make their money from having well stocked shelves which matches demand at a single price (or promotions if on). They replenish stock overnight.
 
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