BHETA has launched a ‘Commodity, Energy and Freight Price Tracker’ to help members keep up to speed with the current turbulent inflationary situation. The new report, which will be published monthly, will sit alongside the association’s monthly Economic Snapshot and quarterly Market Data report.
The new BHETA Price Tracker is designed to assist suppliers as the Consumer Prices Index (CPI) rose by 11.1% in the 12 months to October 2022. With many housewares and home improvement products tracking higher still (power tools – 16.9%, cutlery – 12.3% and garden furniture – 14.1%, for example), the situation is fast-moving, and something not seen for nearly thirty years. One of the practical consequences of this is that many retail buyers and suppliers’ sales teams do not have experience of the intricacies of price increases on this scale.
Steve Richardson, BHETA marketing manager, said: “While it is obvious that product costs are made up of many elements, including raw materials, transportation, labour, energy and processing, present circumstances make it even more crucial that suppliers and buyers understand the relative influence of each, if they are to have meaningful and productive price negotiations.
“For example, with a highly process-driven product, energy could represent 60% of the production cost, and raw materials only 20%. In this case, energy price rises of 10% will have a much higher impact on cost even if raw material costs decrease.
“It is important both parties understand what is involved if fair outcomes are to be achieved, and indeed, if communications to the consumer are to be accurate as well. BHETA’s new Commodity, Energy and Freight Price Tracker is designed to ensure that BHETA members have the information to communicate effectively.”