Having negotiated one challenge after another in recent years, we’re now some months into a cost of living crisis that threatens to create significant hardship and recession. In September's Furniture News, Paul Farley asks the furniture trade how operators might create better margins without implementing substantial price hikes – and if consumers can be persuaded to pay more for furniture right now …
Against a backdrop of unprecedented material cost rises, the war in Ukraine put further pressure on materials like timber, and set in motion a chain of soaring energy costs.
Many had no option but to share the burden with their customers. In April, inflation was running at 7% – the highest in three decades – with furniture prices up 17% YoY. With few signs of improvement and weakening consumer confidence, the trend continued into the summer. Shop prices were up +16.6% in June, reported the BFM.
Anecdotally, it seems that many material prices are levelling out – but prices remain high, and uncertainty remains.
In September's issue, we explore the impact of price rises across the trade. Rather than delving into the reasons behind them, we’re looking at how suppliers and retailers might best negotiate the coming months. Given the sheer scale of the cost of living crisis around us, should your business absorb the price rises, or pass them on? Can consumers be encouraged to pay more for furniture – or would it be suicidal even to ask?
The range of views is fascinating – take a look at this month's discussion feature to see what furniture retailers, suppliers and service providers have to say on the matter.