It’s been difficult for all of us to avoid the rising cost of living in recent months as impacts are felt both at home and in the workplace.
Food and fuel rates have dominated recent headlines, with raw materials such as oil spiking in price recently and driving up many other associated costs in the process.
This also drives the price of other raw materials. But why is this the case, and what impact is being felt on different trades? Let’s take a look.
The cause of price rises
There have been several incidents affecting global process recently. Just here in the UK, the ongoing impact of Brexit has altered prices paid at supermarket checkouts as supply chains struggle to keep up with new regulations.
Russia’s invasion of Ukraine and the economic sanctions meted out to the aggressors have also affected things. With many countries now turning away from Russia for the supply of key things like oil and gas, a growing scarcity has driven prices up to unprecedented levels.
The impacts of price rises
The most immediate impact of these price rises typically goes one of two ways. Increased prices for consumers, or diminished returns and margins for businesses.
It’s a particularly difficult decision for businesses on the smaller end of the scale, as going in either direction could lead to a loss of revenue.
If some of the rising costs do have to be passed on to customers, it’s important to have open and honest conversations about this. People are much less likely to be understanding and keep trading with you if you suddenly spring a price hike on them.
Ways to keep costs down
It’s tough for businesses to insulate themselves – and ultimately their customers – from these price rises.
Some trades can benefit from utilising products that swap out certain materials but don’t skimp on quality. Roofers can use lead-free flashing alternatives, for example.
That commitment to quality should always remain a key focus, however. Indeed, routinely delivering a high standard of service and end product while building up a collection of strong and positive recommendations will ensure you keep the business rolling in.
Will prices always remain this high?
Inflation is currently at record-breaking levels and could keep rising well into 2022.
However, it is forecast that things will turn in the opposite direction in the coming years which could see a return of lower prices when it comes to raw materials and other linked processes.
As we have already seen in the first few months of 2022 – and indeed over the past two years – predicting how world events will shape these things is next to impossible.