It's August 2024 and I think we can all agree that inflation is effecting us all. Regardless of where you live you are seeing the cost of groceries, gas, clothing, haircuts and just about everything go up. Inflation went from 0.8% in 2014 to 6.5% in 2024 according to "usinflationcalculator.com" What does this mean for spending? Small Businesses and Affordability? They are all linked and work like a circular system. Lets first talk about spending. Our spending habits are directly linked to access and affordability. As prices have increased spending is down at small business, specialty businesses and for services deemed "not necessary" or to expensive. But spending and revenue increase is up with billion dollar corporations such as amazon, shein and Temu.
When it comes to establishing prices its important to understand how are they determined? There is a huge difference between small businesses and large corporations and setting prices. We are talking about huge sums of money and power vs small and local mostly family|independently owned businesses. This is why you see small businesses opening and closing more frequently especially since the pandemic and post pandemic. There is not a big pool of money or bail out for smaller independtly owned businesses. Large corporations can get costs of good much cheaper by purchasing | creating items for pennies on the dollar. If you are a small maker, artists or service worker your cost of goods are much higher. Small businesses can't compete. And the loss is small and local. I'm not sure if small businesses can or will recover, especially with more people shopping online and with more convenience. The pandemic trained everyone how to shop online and I'm sorry to say I don't think shoppin in stores is coming back to where it once was. Ask any small/local business owner. We can't offer rock bottom prices to compete, we can't do same day delivery, we are already stretched so thin with social media, marketing and all the other jobs that small business owners must do daily to just keep the doors open.
Spending: This brings into play companies like Shein and Temu, who have horrible worker practices, products and environmental impacts, yet are making TEMU - 6 billion dollars yearly SHEIN $32.5 billion in 2023. How are we reconciling affordability for environmental, societal, personal beliefs when spending with companies that directly oppose our personal beliefs. Whats the ultimate cost of affordability?
On the flip side of this I am noticing trends with buying expensive designer, big ticket items and vintage moving into a territory of unafforability. Vintage stores were once "vintage" now they must carry designer, new brands, candles and diversify stock to catch more customers who might not be a vintage shopper. This goes for Pretty Penny too. We started incorporating our "curated collection" 10 years ago because we wanted to expand our customer base. In 2024 the landscape has changed even more to a place I don't quite understand in what the general public are looking for ? price points? quality ? sustainability ? design ? small designer? affordable ? accessible ? Or just to be entertained ?
Affordability. Accessibility. Budget.
Nick and I have been thinking long and hard on how we can keep the doors open to our businesses and make enough to just survive, because at this point the financial future of living in the Bay Area, being small business owners and just living is the hardest its ever been. We look at cheaper places all over the country weekly fantasizing about living somewhere more affordable. This means pulling our kid out of school, dismantling the businesses AGAIN and moving, all which is disruptive mentally and physically. We've also tried the grass is greener when we moved out of the Bay Area once before and it didn't work out and we came back. The Bay Area is our home I just wish it was a more affordable place to live and have a small business. So what do we do ? How do we want to show up for our community and our businesses.
Moving forward we will continue to provide you with high quality service and products in a comfortable environment for accessible price points.
We will use our space to house community members and small business giving others opportunities with pop ups and collaborations.
Nick has thoughtfully put together his budget cut and I have thoughtfully priced items in the shop both in store and online, we want everyone to be able to have access to quality items and services.
I hope to see you in store and online and if you aren't able please share with your family and friends, we would love to keep serving you as long as we can.
We have an alteration specialist. You can get your pretty penny items altered. Or bring in your own outside items to use these services.
