The United States is in a serious crisis! Sellers should adjust their prices as soon as possible!

The U.S. Department of Commerce announced a very grim news last Friday. The consumer price index CPI has risen by more than 4.2% since entering April, far higher than the expected 3.1%, indicating that the entire U.S. market is in serious inflation .

CPI is an indicator that reflects the fluctuation of the prices of consumer goods and services within a certain period of time. It is used to measure whether there is inflation in a country's market and the severity of inflation. The ideal situation is about 2-3%, with a small increase to maintain market vitality.

The data released by the U.S. Department of Commerce last week showed that the United States is now in a relatively severe inflation situation. This is one of the consequences of the trillion-dollar stimulus plan signed by the United States at the beginning of this year and the massive printing of money.

Historical data shows that the current surge in CPI (4.2%) is close to the highest level since 1981, and even exceeds the financial crisis in 2008. (In comparison, my country's CPI index in April was only 0.9%)

CPI is an indicator that truly reflects the price of goods. With such a terrible increase, it is definitely an all-round increase in prices. Here is a tweet from an American netizen. Four corns are now sold at Target for $4.49, which made the netizen exclaim, "Has anyone noticed that food prices are skyrocketing recently? Salmon, which was only around $12-14 at the beginning of the year, is now sold for $19-21."

According to an investigation by local reporters in the United States, after counting major offline supermarkets, it was found that price increases for daily consumer goods were very common, basically increasing by about 10% in April. Among them, the increase in corn was the most exaggerated, reaching as high as 44%!

The US dollar exchange rate has been falling recently due to the release of watermarked banknotes. Our cross-border sellers are facing the situation of increased import costs of raw materials (ore, cotton, etc.) and a backlog of profit margins. Taking advantage of the current US inflation, it is the best time for sellers to adjust their profit margins.

Recently, the concepts of "lying flat" and "involution" have become quite popular. In our seller circle, they correspond to the two situations of "Buddhist operation, placing orders as fate dictates" and "Crazy price war, there is only lower but no lowest" .

Let me use a more vivid metaphor to explain "involution". When a certain category comes out, everyone makes money peacefully, and the product pricing and quality are similar. Suddenly, someone emerges and grabs most of the orders in this category with an ultra-low price. Others are forced to lower their prices, one lower than the other. If they are not low enough, there will be no orders. However, after lowering the price, the seller's profit is also compressed to the extreme, or even loss-making. The only way is to reduce product quality to optimize costs, which eventually forms a vicious cycle. This is involution .

Please note that there is an essential difference between involution and competition. In involution, sellers’ profits become smaller and smaller, and the products customers get become worse and worse. There are no winners in involution, and everyone is unwillingly forced into a worse outcome.

I believe that many sellers have recently been paying attention to profit margins, running at a loss, etc. These are enduring hot topics in the cross-border industry. No one wants to do business at a loss, but where is the boundary between profit and cost ? If you put the product on the shelf at half price, directly at the cost price, then there must be someone who is lower than you and "involve" with you. Even if you can sell at the lowest price, can the quality of the product be guaranteed? How long can you lose money? Since you can't "volley" with others, isn't there a way to make money without "involve"?

Since our establishment, we have been promoting high-profit strategies to our students and fans, using holiday promotions and enough white-hat traffic on and off the site to support this profit margin. This is because there is no end to price wars. If you can offer a price of 1.99 today, someone else may offer it at 1.98 or even 0.99 tomorrow. There is no point in competing with lower prices. How to make the product while ensuring profits is what Amazon sellers really need to consider.

Under the background of accelerating inflation in the US market, it is a great time for us cross-border sellers to adjust our profit margins! All daily necessities are rising in price, if not now, when will they rise? Moreover, the cost of our raw materials has also increased due to the depreciation of the US dollar. At this time , insisting on the strategy of running at a low price and at a loss will only kill us faster.