http://www.financialpost.com/story.html?id=878065
Summary
The article I read is about the early discount of retailers before Christmas in order to attract to customers due to fear of the stock market. Many retailers are watching the economic crunch with the same mixture of horror and dread gripping consumers and wonder whether shoppers will stay away in droves during what is traditionally the busiest shopping period of the year between Thanksgiving and Christmas. Marketers are focusing on value over style across every category. And at a time of the year when sale signs are generally rare in retail store windows, they are abundant. Many big stores in Canada like Sears started to discount at the beginning of October and is running until Christmas.
Connection
The connection between this article and chapter 12 is the cash discount. A cash discount is a reduction of the amount of a bill if payment is made on or before the discount date stated on the bill. As stated, the purpose of a cash discount is to encourage the customer to pay promptly. Businesses offer discount to customers in order to increase sales. Although in this case, most of the sales is made instantaneously at the time of the purchase by cash or credit card. However, when an item needs to be delivered or an invoice is issued, cash discount occurs which also often happens in the busy Christmas time. Besides the discount, the terms of sale will also be changed as discount takes place. Almost all the term of sales of a business will be changed during the sales period which may favor the customers.
Reflection
After reading this article, and compare this article to the previous article in chapter 11, I’m amazed by how the stock market can affect a business’s routine. To keep the business running, retailers have to make discounts. And now, the discounts which usually take place in Christmas and the time people spend most money on are happening now. Sears introduced the Budget Relief Price Drops sale, which is smart. On the other hand, the limit of discount has increased, retailers made the due date from 60 days to 30 days to operate the money properly. Consuming is a big part of the impulse towards the economy. So, increase consuming may bring back the stock market which is good for both the business and consumers.
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2 comments:
Having the economic downfall with Christmas only being one month away, some business might worry about a drop in sales considering December is the busiest spending time for consumers all year. I think it is good idea that stores are allowing cash discounts for people who are willing to pay up front or within the net amount of days. The fact that many stores will have Christmas sales will also help attract customers to buy their goods. Even with the economic downfall, I think that the majority of Canadians will push aside the economic crisis and will continue to spend money on buying gifts for their loved ones. It is because I believe that Canadians are the most generous in giving during the Christmas holidays.
Tommy On
Block A
At first i have to say 顶。Providing discount to customers is a very smart way to avoid cash flow issue. Especially during Christmas People are willing to buy more goods. Basically discount is good for both company and consumers. In order to gain a higher profit, company use discount to increase the amount of consumers and curtail the time of collecting cash. i think if people are willing to buy things, the market is not going to crush that easily. They are really putting an effort to minimize or curtail damage or loss from the economic crisis.
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