In the News
Price Elasticity of Demand | Greggs Sausage Rolls Rise in Price - Again!
Do customers notice and respond to several small price increases less than if prices rise more signifcanly in one step?
That's the thought that crosses my mind as I read here on Reuters that Greggs have raised the price of their legendary sausage roll once again!.
A Greggs sausage roll was £1.05 pound at the start of 2022. It rose to £1.10 pound in May 2022. And now in early October 2022 it is £1.15.
Have a go at working out each of the two percentage increases.
5 pence here. 10 pence there. Maybe we consumers don't notice the small, incremental price changes.
Or perhaps we're not too concerned anyway.
After all, what's not to like about Greggs iconic product and it's still a bargain compared with many other food-on-the-go product offerings.
So, I suggest that the PED of the sausage roll remains well below -1.0.
Which leads me nicely onto today's business joke.
Why did the sausage roll factory close?
Because it couldn't make both ends meat.