We can all see that inflation is beginning to rear its head, and customers are starting to notice. In our stores we are seeing pricemarked packs moving up in price, pack sizes getting smaller and staple items starting to move up at wholesale price. I have absorbed three significant price increases in milk alone over the past year.
Trying to explain this to customers is difficult. We have engaged in a strategy of moving much of our core product range over to price mark variants. This enables us to at least stand behind a retail price which if it moves upwards gives that increase an air of legitimacy to the consumer.
The real problem is that food prices have been kept artificially low for so long thanks to a variety of reasons, and there must be a tipping point where this is no longer sustainable for everyone in the sector.
Many of us have been wanting this inflation for a while, too. We want to see more cash going into our tills. A rising cost base that is exponentially increasing when the consumer still thinks four pints of milk should be £1 is not a good place to be.
With further food price fluctuations on the horizon I am left wondering what other strategies are left for me, and the answer is very few.
My biggest issue is how you get the consumer to understand how precarious the food supply chain has become. Weather, currency fluctuations and fewer players in food production have dramatic consequences on prices and availability.
Will consumers further embrace more regional foods, or is the £1 milk culture too strong to break?