Are local stores accused of increasing prices price gouging ?
Texas Attorney General’s Office investigating thousands of complaints across Texas
Over the past several days KSAT 12 has been inundated with messages from viewers with concerns about price gouging at some local stores.
But how widespread is the problem and what happens to small businesses that are wrongfully accused of it?
Local grocer Juan Canedo, owner of Thrif-T-Mart, said he spent much of his weekend doing damage control after a customer accused him of price gouging online.
“I am disappointed that we were accused of this,” Canedo said in an interview Sunday. “Today, I couldn’t take care of my customers. I had to address these allegations.”
The post about his store went viral and it wasn’t the only one. Several viewers sent us pictures of what they thought were stores taking advantage of an emergency situation by overcharging. But is that really what’s happening?
Not according to the store's attorney, Ben Kemmy.
“Their margins are staying the same, there’s not any price gouging,” Kemmy said. “It’s just that the cost to acquire those goods has now gone up.”
Invoices shared by the store show they paid $11 for a case of Disney character water bottles that were sold for $11.75.
“It’s way below our normal mark up. Seventy-five cents for the $11 is less than an 8% markup,” said store employee James Rodriguez.
Small stores like Thrif-T-Mart are also having to find nontraditional vendors to keep their shelves stocked. They are now getting some items from a company that sells food to catering companies. So, instead of selling eggs by the dozen they’re now selling them in trays of 30, which costs more.
“We paid $14.99, that was our cost on March 10 and then in 10 days our price doubled and so our cost reflected that,” Rodriguez said. “It is shocking. It’s shocking for anyone, because you’re normally used to paying a certain amount.”
The store was visited by investigators who looked over their invoices, but they haven’t yet been officially cleared of any wrongdoing.
The state and local authorities take price gouging very seriously.
The Texas Attorney General’s Office said Monday it has received 1,562 complaints related to the current disaster declaration. Officials said 1,448 of those complaints were alleged price gouging, with most of the complaints coming in from the Houston and Dallas areas. Those complaints are currently being investigated.
If price gouging is confirmed, those responsible may have to reimburse the customer and could be liable for civil penalties up $10,000 per violation and up to $250,000 if the consumers are elderly.
But if the allegations are unfounded, it can be tough to undo the damage.
“It can be incredibly damaging because small stores like this, when something goes viral on Facebook and on social media, it can be devastating to their reputation,” Kemmy said.I
f you suspect price gouging, ask the store owner to explain the price increase. If you believe they’re still charging too much, call the AG’s office to file a complaint or call your local authorities so they can investigate. But remember, just because you saw it on social media doesn’t always mean it’s true.
Additional info from the Texas Attorney General’s Office:
Consumers who encounter price gouging or deceptive trade practices are always welcome to file a complaint with our office either online or over the phone. Complaints can be filed online here: http://txoag.force.com/CPDOnlineForm, or through email at email@example.com, and our consumer protection hotline is 800-621-0508. You can learn more about the consumer complaint process here.
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