Uniqlo ditched plans to raise the price of its popular ¥290 ($1.84) socks, underscoring the challenge Japanese retailers face as persistent inflation squeezes household budgets. Earlier this month, the apparel brand, owned and operated by Fast Retailing, had announced broad price hikes for its clothing products due to rising costs. Less than two weeks later, it reversed a decision to increase the price of its socks by ¥100 and eliminate discounts on purchases of three or more pairs.
After decades of deflation, which conditioned Japanese shoppers to expect flat prices, retailers are struggling with how much of their rising costs they can pass on to customers. Consumer prices, excluding fresh food and other items, climbed 3.2% in September from a year earlier, while household spending is shrinking, reflecting the challenge companies face when seeking to protect margins.
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