Quote:Prices are set by supply and demand.   If a business can raise its price, it will and should.   Imagine if you were selling widgets at $12 per widget.   But you figured out you could price them at $20.   What do you do?   Your customers don't care how much those widgets cost you.   All they care about is how much you are going to charge them.  

 

Now imagine you go to your customers and tell them you are raising the price of your widgets because your costs have gone up.   Do your customers really care that your costs have gone up?   No.   All they care about is how much money they have to spend, and how much do they want that widget.  

 

This is why every time a business tells you it is raising its prices because its costs have gone up, it is conning you.  They are raising their prices because they figured out that you are willing to pay more.  They are just giving you an excuse.  "My costs have gone up." 

 

If a restaurant decides to raise their prices because their costs have gone up, and they successfully raise their prices, well why did they wait until their costs had gone up?  Why didn't they raise their prices a long time ago?  Obviously, the public was willing to pay a higher price.  And obviously, the diners don't care about the fact that the restaurant is going through some sort of cost squeeze.   All they care about is how good is the food, and how much are they willing to pay to eat there.