Discount retailer Dollar Bill’s has been struggling to maintain its margins over the past two years because of inflationary pressures, delays on imported goods, and decreased foot traffic. Now the board has asked CEO William Fisher Jr. to develop a strategy for raising prices. William worries that raising prices will hurt the company’s reputation and alienate customers, but he recognizes that something has to change.
Should Dollar Bill’s maintain the dollar price point by reducing product quantity, such as repackaging five-packs of chewing gum into four-packs for the same price? Or should it abandon the dollar price point and begin offering an array of more-expensive goods? This fictional case study features expert commentary by Greg Besner, the CEO of Sunflow, and Barrie Carmel, the vice president of pricing at Michaels Stores.
William Fisher Jr. opened the door to his office and pointed to the metal folding table in the corner. It was the one his father had bought in 1957, the year he founded Dollar Bill’s, and staffers now jokingly—but lovingly—referred to it as “the executive conference table.” Today it was covered with packs of candy, stationery items, bottles of water, tiny action figures, and countless other knickknacks.
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