No one has suggested "price fixing". They said they would end "gouging".
Every business has "profit margins" - a percentage of markup from wholesale prices. As a banker, we had to parse financial statements to look at numerous factors over an above profit and loss. "Rate of turnover", "average collection periods" on receivables, and "profit margins". Grocery stores have raised their profit margins by 40% above costs, in the past two years.
Simply stated, if something cost $50.00 wholesale, and sells for $75.00 retail, that a 50% net profit margin. You made $25 above the cost of the goods. But if you raise prices to increase net profit margins by 40%, as grocery stores have done, raising the retail price to $85.00, now your making $35.00 on this item. And while the business was making money selling this product at $75, now you're making MORE money without doing anything whatsoever.
So if I simply increase my profit margins across my whole inventory, I'm making record profits for doing nothing. Computers make it easy to do. They'll do all of the calculations you need, and you just have to put new price stickers on the merchandise.
Conversely, to end price gouging, you don't "fix prices", you fix "profit margins". Your net profits should not exceed X% of costs. What the stores charge is still up to them, and if their wholesale costs increase, then they can raise prices accordingly, but they cannot raise profit margins.
Every industry has different profit margins. It's not a "one size fits all" item. So what your margins should be, change depending on the business.
Profit margin gauges the degree to which a company or a business activity makes money. It represents the percentage of sales that has turned into profits.
www.investopedia.com
:max_bytes(150000):strip_icc()/profitmargin-95e131f391884e60a86dd080c4f23dae.jpg)
