The consequence thread (Brexit)

[monkey104]

I`m talking from direct experience here, not what I think might happen or have read about. Two of my biggest suppliers both put their prices up quiet significantly (5 to 10%) on the 1st of September. Thus I`ve just put most of my prices up by the same margin.

Is the fact two suppliers both put their prices up 10 weeks after the vote (when things should be looking slightly less uncertain) just co-incidence ? Or are a load of other businesses going to do the same thing ? This paragraph is just supposition (unlike the first) obviously.

 

I'm not a businessman but surely if you put your prices up customers will eventually stop buying from you, you will stop buying from your supplier so your supplier has to either (a) reduce prices or ( b) go out of business.

P.s. Why did he put up his prices in the first place?

Edited August 27, 2016 by monkey104

[tinfoilhat]

I'm not a businessman but surely if you put your prices up customers will eventually stop buying from you, you will stop buying from your supplier so your supplier has to either (a) reduce prices or ( b) go out of business.

P.s. Why did he put up his prices in the first place?

 

Prices changing because of the exchange rate I suppose. I've got two orders going to over seas suppliers in the next month whose prices rarely shift. It will be interesting to see what happens.

[apelike]

I`m talking from direct experience here, not what I think might happen or have read about. Two of my biggest suppliers both put their prices up quiet significantly (5 to 10%) on the 1st of September. Thus I`ve just put most of my prices up by the same margin.

Is the fact two suppliers both put their prices up 10 weeks after the vote (when things should be looking slightly less uncertain) just co-incidence ? .

 

The probable answer is yes as I have already explained in reply to I1L2T3, but its worth repeating again;

 

August 2016

 

UK PRICES

 

"GB pig prices continued to increase in June, at a slightly stronger rate than the previous month. The monthly average EU-spec APP was 4.89p up on May, at 124.35p/kg. While this was still 12.53p behind the same point a year earlier, this gap is decreasing. The market has now recorded three months of consecutive price increases."

 

So the prices for British pork was already rising since before brexit and possible will set to continue. Notice that the monthly average EU-spec was up 4.89p on the May price of 124.35p/kg. I probably bin more money by cutting off the fat than any increase in cost.

[Justin Smith]

I'm not a businessman but surely if you put your prices up customers will eventually stop buying from you, you will stop buying from your supplier so your supplier has to either (a) reduce prices or ( b) go out of business.

P.s. Why did he put up his prices in the first place?

 

It was mainly the lower value of the pound, most stuff is imported these days, particularly the cheaper stuff. That said we specialise in better quality gear, an a high proportion of even that is also imported. Chinese products really are much cheaper even having been shopped half way round the world.

 

Whether people buy or not is only half the answer, if we`re not making any money on it, or insufficient, then there`s no point in selling it.

[I1L2T3]

The probable answer is yes as I have already explained in reply to I1L2T3, but its worth repeating again;

 

August 2016

 

UK PRICES

 

"GB pig prices continued to increase in June, at a slightly stronger rate than the previous month. The monthly average EU-spec APP was 4.89p up on May, at 124.35p/kg. While this was still 12.53p behind the same point a year earlier, this gap is decreasing. The market has now recorded three months of consecutive price increases."

 

So the prices for British pork was already rising since before brexit and possible will set to continue. Notice that the monthly average EU-spec was up 4.89p on the May price of 124.35p/kg. I probably bin more money by cutting off the fat than any increase in cost.

 

The one simple fact you are failing to register is the pound is weakened because of Brexit and that will increase the cost of imports. If prices were rising before Brexit then the weakened currency will compound the problem.

 

Somebody has to take the hit for that somewhere along the line and it'll be consumers. Yes there may be existing contracts in place for a time to mitigate it, and some companies will try and absorb the impact but a weakened currency only means one thing: imported inflation.

[tzijlstra]

The probable answer is yes as I have already explained in reply to I1L2T3, but its worth repeating again;

 

August 2016

 

UK PRICES

 

"GB pig prices continued to increase in June, at a slightly stronger rate than the previous month. The monthly average EU-spec APP was 4.89p up on May, at 124.35p/kg. While this was still 12.53p behind the same point a year earlier, this gap is decreasing. The market has now recorded three months of consecutive price increases."

 

So the prices for British pork was already rising since before brexit and possible will set to continue. Notice that the monthly average EU-spec was up 4.89p on the May price of 124.35p/kg. I probably bin more money by cutting off the fat than any increase in cost.

 

Do you genuinely believe your Morrison's, Tescos, Primarks etc. of this world, often operating on a 1% profit margin overall are going to not put prices up across the board when the stuff they import has gone up by 15%? I already notice it in several products as it is, it will only get higher.

 

Fuel across the board in Europe has been dropping in price, 6 cents since Brexit in the Netherlands. At the same time it has been coming up here, around 5p a litre at where I usually get it.

 

So that means that transport in the UK is going to go up in price after it had been coming down (relatively) in price in line with the drop in fuel costs. That is a slow burning wick but it will translate into higher prices. Take Tesco as an example again - they have thousands of shopping delivery vans across the country, they all of a sudden cost .4p/m more to operate, do that times the thousands and... you see where I am going.

[andyofborg]

....... only means one thing: imported inflation.

 

A small amount of inflation might not be a bad thing. It would drive companies to invest to improve productivity, something which has been noticeably lacking over the last few years. On the other hand, companies need a degree of confidence to consider investing and that seems to be ebbing away and too much inflation will be a very very very bad thing.

[Guest]

A small amount of inflation might not be a bad thing. It would drive companies to invest to improve productivity, something which has been noticeably lacking over the last few years. On the other hand, companies need a degree of confidence to consider investing and that seems to be ebbing away and too much inflation will be a very very very bad thing.

 

................................................................

 

Edit: misread your post.

[El Cid]

Do you genuinely believe your Morrison's, Tescos, Primarks etc. of this world, often operating on a 1% profit margin overall are going to not put prices up across the board when the stuff they import has gone up by 15%? I already notice it in several products as it is, it will only get higher.

 

 

That is very true; but it may be that the things they are importing could be made/grown at just 2% above the foreign price. So once prices have risen it will stimulate UK local production.

[tzijlstra]

That is very true; but it may be that the things they are importing could be made/grown at just 2% above the foreign price. So once prices have risen it will stimulate UK local production.

 

Yeah, I hear June is a great time to grow banana's and wine grapes.

 

Like it or not, the (consumer) society of today expects certain things that are imported. We could build a massive battery factory down't Attercliffe and start churning out 10 million batteries a year and it still wouldn't be enough for the country, let alone the price difference would mean nobody would buy it.

 

This 'ignore the global effect, we'll make it ourselves' notion that I keep hearing from Brexiteers is rather disturbing blindfold naivety, wouldn't you agree?