Putting up prices after Brexit - any tips?
Discussion
As a B2B wholesaler it's always a worry increasing prices - every year we put them up a tiny bit and it always goes well however I always think I will get into the office the next day and the phone won't ring!
So I'm cautious of increasing it and using 'brexit' as an excuse.
Has anyone done this or received a price increase?
Was it worded well? Any do's or dont's?
So I'm cautious of increasing it and using 'brexit' as an excuse.
Has anyone done this or received a price increase?
Was it worded well? Any do's or dont's?
8.5% increase from our main supplier. Sort of middle of the road. Some are only doing 3% in case things settle down by January, others are as high as 16%.
They were just matter of fact about it and promised to act quickly if the £ recovered. Can't do much about it but they gave us a week's notice so I chucked a lot of money at a couple of huge stock orders before the price increase took effect.
They were just matter of fact about it and promised to act quickly if the £ recovered. Can't do much about it but they gave us a week's notice so I chucked a lot of money at a couple of huge stock orders before the price increase took effect.
Most of my suppliers are putting up their prices,if not now then for SS17.
Owing to poor exchange rate £ to $.
I can't really argue with that....but it does mean I,once again,compare prices to see which supplier offers best value.
So keep your price rises reasonable, as there is competition out there.
I definitely would not use Brexit as the reason,say currency exchange rate instead.
Owing to poor exchange rate £ to $.
I can't really argue with that....but it does mean I,once again,compare prices to see which supplier offers best value.
So keep your price rises reasonable, as there is competition out there.
I definitely would not use Brexit as the reason,say currency exchange rate instead.
We have had some suppliers increase their prices 10-15%!
The thing is pretty much all of our suppliers buy from CHina and pay in USD so they have no choice. It's a basic understanding between supplier and buyer that the supplier is going to have to put prices up becasue of the exchange rate effected by the Brexit result.
They were talking about this very thing on the news this morning saying that inflation is going to increase becasue of imported goods. I would be very surprised if any supplier of anything they were buying in USD didnt pass on the price increases to their customers else it will directly hit their bottom line.
The thing is pretty much all of our suppliers buy from CHina and pay in USD so they have no choice. It's a basic understanding between supplier and buyer that the supplier is going to have to put prices up becasue of the exchange rate effected by the Brexit result.
They were talking about this very thing on the news this morning saying that inflation is going to increase becasue of imported goods. I would be very surprised if any supplier of anything they were buying in USD didnt pass on the price increases to their customers else it will directly hit their bottom line.
What will you chaps who pay corporation tax do if the Government reduce that tax to 12.5%?
Will you then reduce your prices?
The exchange rate fluctuation effect will be proportional to the import proportion of your costs. If it is 5% of the finished product cost, then the effect is minimal. If it is 75% of product cost, then much larger, but then it may make it worth looking for another source. Heaven forbid, you may find one in the UK.....
The £ has been overvalued for years. We are not alone, many Euro countries are in the same boat - Greece, Spain, Italy to name but a few.
The exchange rate changes (I buy a product made in China, traded in USD - It is a one time cost, as I rent that product to others) will make much less difference to me than the price increase in steel did a few years back. Still had to suck it up then, so will now.
Will you then reduce your prices?
The exchange rate fluctuation effect will be proportional to the import proportion of your costs. If it is 5% of the finished product cost, then the effect is minimal. If it is 75% of product cost, then much larger, but then it may make it worth looking for another source. Heaven forbid, you may find one in the UK.....
The £ has been overvalued for years. We are not alone, many Euro countries are in the same boat - Greece, Spain, Italy to name but a few.
The exchange rate changes (I buy a product made in China, traded in USD - It is a one time cost, as I rent that product to others) will make much less difference to me than the price increase in steel did a few years back. Still had to suck it up then, so will now.
Edited by Storer on Wednesday 17th August 21:17
I personally wouldn't plan on the GBP increasing against the USD at any time soon.
Certain banks that I have mates at are using the pound being between parity and 1.1 within a year against the USD. That seems to be the general direction of the currency, however as we all know past performance is not an indicator of future results!
Once everything starts to get repriced, it's going to hurt!
Certain banks that I have mates at are using the pound being between parity and 1.1 within a year against the USD. That seems to be the general direction of the currency, however as we all know past performance is not an indicator of future results!
Once everything starts to get repriced, it's going to hurt!
VEIGHT said:
Things even worse now with the USD at 1.23!
I don't want to put prices up more than once in quick succession.
How is everyone else doing?
We're doing ok but have been sitting on 6 figures (retail value) of stock paid for last year which we only began selling 3 months ago due to a warehouse relocation. We can probably weather things for the next couple of years using this stock as well as our current sales. I foresee more price increases as companies tried to keep the original increase in August as small as possible in the hope the currency would bounce back. Now that that looks unlikely and that further falls in the value of the £ may be inevitable I think we'll see another price increase in January. In fact, I know some suppliers that are planning it.I don't want to put prices up more than once in quick succession.
How is everyone else doing?
Welcome to the beginning of the public spending slow down as costs of goods and importation increases, prices increase and you cannot buy as much and people have less money.
I'm just waiting for all of the "out" voters and the gray brigade who voted us out to start complaining that things are too expensive and that they now cannot afford to live and pay their heating bills, so expect the government to help them out.
I work in logistics and I have seen an increase in UK exports in the past couple of weeks, but a slowdown on imports and the fact that bringing in a 40ft container from the US, over night after BREXIT, increased by circa $250 just on exchange rate alone. Its now around $300 with the further decrease in the £ against the $. China increased by about $150 on the freight alone, plus the value of the goods.
I have one customer who's costs increased 34% overnight. They import electronic products that are used by the over 65's in the home and their sales have decreased as these people now say they cannot afford to buy on their pensions not going as far....
I'm just waiting for all of the "out" voters and the gray brigade who voted us out to start complaining that things are too expensive and that they now cannot afford to live and pay their heating bills, so expect the government to help them out.
I work in logistics and I have seen an increase in UK exports in the past couple of weeks, but a slowdown on imports and the fact that bringing in a 40ft container from the US, over night after BREXIT, increased by circa $250 just on exchange rate alone. Its now around $300 with the further decrease in the £ against the $. China increased by about $150 on the freight alone, plus the value of the goods.
I have one customer who's costs increased 34% overnight. They import electronic products that are used by the over 65's in the home and their sales have decreased as these people now say they cannot afford to buy on their pensions not going as far....
Ste1987 said:
So, coincidence then?
Yes, last week's fall in the £ was down to a machine triggering it, poor software coding. As usual the supposed 'experts' decide that something is going to happen and then ensure it does. Remember 9/11? 30% off shares in all companies regardless of any direct effect of the incident. Expert knee-jerk reaction, ooh, that will make the share price fall so I had better sell now before it does, hence triggering the fall.Gassing Station | Business | Top of Page | What's New | My Stuff