• by Tanya Gazdik , May 29, 2024

Walgreens, Walmart, Target, Aldi and Amazon Fresh are among the retailers dropping prices on items across categories in an effort to lure back inflation-weary shoppers.

“Prices are dropping immediately on more than 1,500 items online and at its stores, which include both name and store brands, Walgreens announced Wednesday,” according to CNN.. “In the past few weeks, competitors including Target, Walmart and Amazon slashed prices on thousands of household goods to rev up consumer spending.”

Retailers are lowering prices as they strive to pull consumers into stores and online to spend more freely on both essential purchases such as food and more discretionary purchases like new clothes. High grocery store prices especially have consumers reeling. 

“Consumer prices have gone up about 19% since 2021, but grocery prices have jumped by about 25%,” according to Vox. “While inflation, which measures the rate of price changes, is around 3.4% right now, way down from the peak of 9.1% we saw in June 2022, that hasn’t meant food prices (in most cases) have gone back down. Now, a flurry of headlines is heralding these price cuts as proof that companies are finally relenting to consumer fatigue with inflation prices.”

The price cuts don’t necessarily mean inflation is getting better. 

“Rather, the price cuts are more indicative of how retailers are trying to compete in a heavily promotional environment,” according to Fox Business. 

Last week, Walmart U.S. CEO John Furner told analysts during an earnings call that the company has almost 7,000 rollbacks, which refers to temporary price reductions on goods.

“I don’t think Target or Walmart would be engaging in such large cuts without commitments from their vendors to cut the price at which they sell to retailers," Preston Caldwell, senior U.S. economist at Morningstar Research Services, told FOX Business. 

Amazon Fresh is also jumping on the price-cutting bandwagon. 

“The retailer plans to slash prices by up to 30% on 4,000 items on a weekly rotating basis, the subsidiary of e-commerce giant Amazon told Quartz,” according to a report. 

Meanwhile, reports surfaced Wednesday that on March 19, Walmart suffered an internal system failure that stopped price data from flowing to the self-checkout stands, according to documents seen by Bloomberg News.

“In total, the documents show, 1,600 stores were affected, resulting in widespread mispricing that has never before been reported,” according to Bloomberg. “Walmart acknowledged that a breakdown resulted in the company overcharging customers. But it declined to provide key details, including how many people paid too much or too little, how much in total customers were overcharged, which items were mispriced, or how long the problem persisted.”