Jamie Kingston’s Post

The cost of essential goods keeps on increasing ↗ Developing the right pricing strategy on an inflation context is key for FMCG businesses 🥫 What changes are you implementing on your pricing strategy? 💰

Relieving to see inflation fall to the lowest rate in 3 years. Whilst this certainly isn't across the board for all types of spend, now and the coming months may be the right time to revisit contracts and relationships which have been at the mercy of inflationary pressure over recent years. Having an open discussion on contractual and supplier commitments now could bring significant benefit and help re-baseline future spend and commitments. Practical next steps: - SRM / supplier segmentation and working on prioritisation based on levels of inflation - Spend, category & supplier review & understand exposure - contract and rate analysis - cost breakdown analysis against market rates or contractual agreements - Assessing future demand and resilience requirements and how that feeds into any discussions https://lnkd.in/e4byv4QP #inflation #costmanagement #srm #contractmanagement

SCOTT’S CHART OF THE WEEK This week is a break from the insolvency and restructuring based charts and a look at the annual growth in food price inflation in G7 economies for the 12 months to November 2023. Despite the recent reduction in inflation generally in the UK, food inflation continues to rank highest amongst the G7. This is partly due to the large percentage of food that is imported into the UK which has meant food prices are susceptible to both the additional costs in transportation and, in respect of EU imports, Brexit red tape. These drivers aren’t necessarily factors that interest rates can affect. Continually high food inflation could have an impact on businesses and consumers alike because of how this feeds into interest rates and rate cuts in 2024. It can impact disposable income and spending habits, such that even if rates were to be cut it may not transpire that discretionary spending in consumer markets is significantly boosted if consumers face spending more on basic items. By association, businesses in these sectors would be impacted. Additionally, high food inflation can negate reductions in inflation elsewhere. To me, there is the potential risk that if food inflation remains high, coupled with anticipated rises in owner occupied housing costs and rising energy bills, which will be exacerbated by energy costs being a significant driver of the current reduction in inflation, inflation picks up again. This could delay future rate cuts. This, in turn, can be a big issue for businesses as if interest rates remain high it can impact finance costs and the availability of finance. With a number of businesses likely to be seeking refinancing this year, higher rates could frustrate this process. #insolvency #businessrecovery #restructuring #turnaround #business #inflation #interestrates #accountant #london

With inflation falling and commodity prices reducing - should procurement pivot from cost reduction to cost protection and seize the opportunity to negotiate (and secure) medium-to-long term fixed prices? https://lnkd.in/g5KAsUVJ

Beating Organisational Price Inflation   According to the UK Government's Consumer Price Index (CPI), the current UK inflation rate reached 10.1% in March 2023, compared to 10.4% in April. However, B3Livings’ price inflation level as of March 2023 is 7.3% per annum, comprising price increases of 7.0% for overhead costs, 11.7% for non-Framework Agreement Suppliers, and 0.43% for Suppliers who have signed up to B3Living’s Framework Agreement.   There is a great temptation to think and believe that all prices have increased by the UK government's CPI rate of 10.1%, irrespective of organisational circumstances. The true measure of an organisation’s price inflation will depend on the market that it operates in and the products and services that it purchases. According to the National Housing Federation, the average UK Housing Association price inflation rate was 11.4% for Jan – Mar 2023.

Regional Purchasing Manager Indices (Update) Following on from my last post, London was still pulling ahead at pace from the rest of the UK in December for a fourth consecutive month according to latest S&P Global PMI data. London reached 58.2 consistent with very strong expansion while the rest of the UK continues to languish at an overall average of 49.7 consistent with contraction. Signs of life were evident in Northern Ireland (51.6) who led the regions, followed by the West Midlands (51.5) and South West (51.3). Increasingly, this will impact general perceptions as a general election approaches. The good news is that UK inflation may fall faster than expected across H1 2024, barring any new supply chain catastrophes emerging in any number of global geopolitical flash points. Interest rates may also fall sooner and faster than previously expected. Hopefully, the obvious regional economic squeeze will also begin to ease. Now if only business investment would finally find its feet again. Since the GFC, I've learned to be hopeful, but not to hold my breath. #ukeconomy #interestrates #bankofengland #ukrealestate #colliers

📈 🔍Despite inflation falling to 2% and economic stabilisation, businesses continue to struggle with the cost-of-living crisis and high interest rates. The #hospitality sector is hit hardest, with double the #insolvency rate of other sectors. Recent GDP data shows declines in retail and food and beverage services, worsened by poor weather. The new government's impact on growth and tax regimes is yet to be seen, but stimulating economic #growth will be vital. 👉 Read our Insolvency and Recovery team's comments on the latest insolvency trends: https://lnkd.in/eaab4A2X Mark Holborow Vince Green Steven Edwards #CroweRecoverySolutions #BusinessInsights #EconomicTrends

UK inflation rate has fallen significantly since last year, however lower inflation doesn't mean prices are falling - just that they are rising less quickly. Businesses continue to grapple with enduring cost pressures that jeopardize margins, necessitating unavoidable price adjustments. With reports indicating lower inflation and the possibility of interest rates declining, consumers might perceive a sense of stability or even anticipate decreases in the pricing of goods and services.  In an environment dominated with media narratives highlighting decreasing inflation, consumer sensitivity to pricing is expected to be heightened. This, coupled with two years of significant pressure on consumers' spending budgets, will pose challenges for businesses in making pricing adjustments. Restaurant brands will need to adopt a highly targeted and strategic approach to managing menu inflation. It is also important to integrate effective tactical pricing initiatives while maintaining a focus on operational excellence. These actions will be essential for navigating the complexities of the current economic environment and ensuring continued success in the market. #restaurantpricing #pearsonhamgroup #pricing #pricingstrategy

Pricing as a topic has so many layers: customer perceptions of value, competition action/reaction, design thinking, and of course inflation. I’m very proud of the way our firm Pearson Ham Group | The Pricing Specialists helps our clients navigate this fascinating and nuanced topic.

UK inflation for February came in at 3.4%, official figures show - down from 4%. Economists had forecast the Office for National Statistics figure would fall to 3.5%. "Food prices were the main driver of the fall, with prices almost unchanged this year compared with a large rise last year, while restaurant and café price rises also slowed," the Office for National Statistics said. This helped bring inflation to its lowest rate for two-and-a-half years. Other big downwards drivers included the hospitality industry and goods and services. At the other end of the scale: "The largest upward contributions came from housing and household services, and motor fuels," ONS said. However, "falls were only partially offset by price rises at the pump and a further increase in rental costs."