I’m currently in the market for a small (70-100 bottle) wine fridge, and have been browsing around since the holiday season – it struck me how much the price have increased on many wine fridges (notably, as seen in several other discussion, the Artevino line from Costco). Would anyone have any insights if this is something we could just ride out, or is it just the way of the new world?
For example, I also purchased a sofa recently and was told by the salesperson that part of the shortages/price increases everywhere was due to a foam shortage specifically; bottlenecked by shipping delays. Is there a giant container ship filled with refrigerant out there in the ocean?
I doubt we’re going to see pricing levels decrease. This is a monetary policy discussion, but at this point in the US our central bank is committed to slowing inflation gradually. Deflation is a possibility but the longer prices stay elevated l, most companies will try to maintain pricing levels even as material prices come down.
In terms of foam (refrigerant) you’re referring to, some of the largest suppliers in the world are located in TX. A weather incident over a year ago took down production for several months, the global supply chain has yet to recover.
Until freight rates go down, larger items like this will not / cannot go down in price.
I work for a company that manufactures an item in China. These items fit in a large box, think of something about half the size of thick twin mattress. And the boxes weigh about 45-50 lbs each.
Before the pandemic, shipping would cost about $4,000 for a container full of these items. That is the all in cost of trucking to the port, container on the ocean, rail and trucking to the warehouse. That price peaked at just shy of $30,000. That took our freight rate per item from around $7 per unit to around $50 per unit.
A $50 freight expense at cost of goods equals approximately $90 at wholesale which equals approximately at $180 at retail.
While there are some material increases and some labor increases, the majority of price increases I am seeing in my industry are because of increased freight costs.
I don’t see prices coming back down. Once a new “floor price” is set, and customers are used to seeing that price, why would prices come back down? Gas is one of the only things I see fluctuate, otherwise prices mostly just go up and never come back down.
Being a New Yorker - I remember like 15-20 years ago something happened and there was an odd shortage of Mozz cheese and all local pizza places had to place a sign in the window that prices were temporarily going up due to supply shortages. Maybe it was a flour shortage, I forget but a pie went from like $10 to $14-$15 and people were up in arms at a 50% price increase. They never went back down after the shortage caught back up. So that is my economic lesson - customers will adjust to the new pricing and there is no incentive for prices to drop. Mind you this is for new items, may be different in used material markets if you want to buy a used wine fridge.
Having recently built a house and still dealing with a few items for it, everyone tells us prices are going up and supply and price issues could be around for 2+ years yet. We snagged two nice Frigidaire coolers and are happy we did.
Appliances generally are in short supply with long wait times. No surprise that wine coolers would be the same - whether because they’re also appliances or because manufacturers are moving parts from wine coolers to general refrigerators.
As for prices never going down - not entirely true. I take the general point, but plenty of areas where they do . . . food, travel, etc. Just need some entrants or companies looking to sell a bit more to push prices downward and others competing do the same. Just not right now.
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