As inflation continues to weigh down Canadian spending, a retail expert says deceptive discounts based on higher regular prices could mislead shoppers this holiday season.
Bruce Winder told Âéśš´ŤĂ˝ Channel on Sunday that consumers can expect to see âa lot of sticker shockâ in retail stores in the coming months.
âYouâre going to see a lot of discounts but a lot of those discounts will be based on higher regular prices year-over-year because of inflation,â he said.
âMy hypothesis is that consumers are going to start [holiday shopping] early and theyâre going to really cherry-pick discounted items.â
Unlike last year, when retail stores faced supply chain shortages, Winder explained that retailers have stacked in excess inventory for this holiday season.
â[Retailers] had to make calls about a year ago before inflation popped up and the economy [took a] hit. So retailers had those big bets and they all arrived,â he said.
Winder added that these retailers are going to have to discount that excess inventory significantly to âmove it out,â and consumers should shop around if theyâre hunting for deals.
Statistics Canadaâs latest consumer price index report shows that Canadaâs annual inflation rate in September lowered slightly to 6.9 per cent from 7.0 per cent in August.
This is a smaller decrease than economists anticipated given hiked-up interest rates from the Bank of Canada, and while economic projections of a technical recession have added to the storm of soured consumer sentiment, some consumers are concerned that retailers are bumping up costs to mitigate financial pressures later on.
âRetailers will mostly try to pass on cost increases when they can,â Winder said. âSome can and some canât. But there are hypotheses going around that some retailers are padding it even more than inflation.â
Winder said that consumers âwonât really know.â
âThe best thing I would say if youâre a consumer is shop around,â he advised.
âLook for real deals, and donât just assume because itâs a discount itâs a great deal. Comparison shop. Look for retailers that have a lot of inventory in store â youâll notice it and theyâll probably be discounting it more significantly.â