A recent report is suggesting that UK retail prices could inflate by approximately 5% over the coming year. The fashion retailer ‘NEXT‘ has already warned that with the rising cost in market pricing could push the sale prices as much as 5%.
The forecasting could also suggest a dip in the retail giant’s profits with estimates coming in at almost 6%.
Some industry experts are also suggesting that the increasing prices could be seen across the board in the retail sector.
The price increases are due to start hitting companies in January as the UK prepares for the formal Brexit.
As one larger pitfalls of the forthcoming exit from the European Union, UK consumers will be hit initially by around £15 billion of increased cost per year. The price increases are a challenging landscape for the British consumer due to suppliers seeing a 15% rise in manufacturing and supply costs.
“The lack of a solid Brexit plan from the government has sent waves of uncertainty across the markets with retail clearly taking an initial hit. Well over half of the products in the UK retail space are imported from overseas and these products without a doubt will increase in value soon with some increasing as much as 8%.”
The pricing hikes are due to hit the shelves by January 2017.
So, what can your business do to remain competitive in the market? Well there are no hard and fast rules as this will effect all businesses in one way or another but you can start to plan and look at the potential outcomes. If your products and services are cost sensitive you need to stay competitive especially when ‘article 50’ is formally announced you need to be in a position to act accordingly.
Now could be a good time to look for new trade agreements with suppliers who would be prepared to offer you a better deal on future purchases. You may need to look at new markets and the ability to exploit the opportunity early on in an active capacity rather than a re-active capacity.
Either way Brexit is happening and the indications are that it may be more of a ‘bumpy road’ than we anticipated.