Nike has joined the Argentinian clothing brand to determine the lowering of the price of some of its products. Similar measures have been taken by Adidas, Zara, Cacharel, Penguin, Paula Cahen D'Anvers and Lacoste. Such decisions are related to the government's policy of suppressing inflation by signing agreements with large chain stores and brands.
American brand Nike said, "The cost adjustment aims to maintain the competitiveness of the price in the market and help the government to ensure the reasonable price of consumer products."
"Nike continues to provide innovative products to Argentine consumers using imported goods and products manufactured by the company's ten factories sub-contracted in Argentina. The aforementioned factories can provide 5,500 jobs," Nike said.
The decision to lower prices was initiated by Adidas and Falabella (the main chain of department stores) to maintain sales, and government inflation would not trigger inflation in apparel and other commodities. The Argentine government assigned the Minister of Trade to negotiate with the large textile sellers on price reductions, thereby slowing price increases.
The price reduction achieved through consensus is also a means of price control, achieving a significant knock-on effect, as other brands and manufacturers have to lower prices to remain competitive. A notable example is that within a few days after the first agreement with the government was reached, Vesubius Textile Group decided to “actively†cut prices by 10%. Lacoste, Penguin, Cacharel and Paula Cahen D'Anvers were all licensed by Vesubius.
Vesubius has increased production, reduced unit costs and prices, but at the same time is also trying to increase exports to make up for losses. Similarly, the Spanish brand Zara (opening 10 stores in Argentina) also followed suit to lower prices, as all major businesses are aware of the need to curb inflation in Argentina, which has been a top priority since the financial crisis of 2001-2002. The most pressing one in the incident.
Despite the remarkable economic growth in Argentina, domestic inflation is still unique to the economy and people's spending power. Since the 1980s, there has been hyperinflation. Continual price increases will only lead to less and less consumption of people; sales will decline, production will be affected, and eventually unemployment will increase.
American brand Nike said, "The cost adjustment aims to maintain the competitiveness of the price in the market and help the government to ensure the reasonable price of consumer products."
"Nike continues to provide innovative products to Argentine consumers using imported goods and products manufactured by the company's ten factories sub-contracted in Argentina. The aforementioned factories can provide 5,500 jobs," Nike said.
The decision to lower prices was initiated by Adidas and Falabella (the main chain of department stores) to maintain sales, and government inflation would not trigger inflation in apparel and other commodities. The Argentine government assigned the Minister of Trade to negotiate with the large textile sellers on price reductions, thereby slowing price increases.
The price reduction achieved through consensus is also a means of price control, achieving a significant knock-on effect, as other brands and manufacturers have to lower prices to remain competitive. A notable example is that within a few days after the first agreement with the government was reached, Vesubius Textile Group decided to “actively†cut prices by 10%. Lacoste, Penguin, Cacharel and Paula Cahen D'Anvers were all licensed by Vesubius.
Vesubius has increased production, reduced unit costs and prices, but at the same time is also trying to increase exports to make up for losses. Similarly, the Spanish brand Zara (opening 10 stores in Argentina) also followed suit to lower prices, as all major businesses are aware of the need to curb inflation in Argentina, which has been a top priority since the financial crisis of 2001-2002. The most pressing one in the incident.
Despite the remarkable economic growth in Argentina, domestic inflation is still unique to the economy and people's spending power. Since the 1980s, there has been hyperinflation. Continual price increases will only lead to less and less consumption of people; sales will decline, production will be affected, and eventually unemployment will increase.
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