Ever bought a shirt at one price, only to return it to the store the following week to see the shirt at a higher price? One of the biggest questions I get asked is if it is illegal to raise the price, and the answer is as simple as the differencet between sale and clearance. If you purchased your shirt on sale, which is a temporary price reduction, the price can be raised back to its original price. If you had purchased your shirt on clearance, a permanent price reduction used to help merchants clear out excess inventory, the store wouldn’t be able to increase the price.
An easy way to remember the difference is that sales are the deals and clearances are the steals.
Department stores especially use the sales strategy to lure you into stores, for example, when stores have Labor Day Sales, etc. Sales give retailers a way to figure out the demand for the item as well as how much you are willing to pay for an item. A store might have a pair of jeans on sale for $50 for one week, but raise it back to $95, if a celebrity wears the brand, thus increasing demand for the product and the price trendsetters are willing to pay for the item.
Photo Credit: Difei Li
