Record rise in inflation and your business

We must remember that if we raise our price, we risk losing customers, especially those who are now being hit by the removal of the Universal Credit "uplift payment of £80 per month" We are dammed if we do raise prices and dammed if we don't..

In short, yes. Regardless of inflation, prices of certain products have been driven down far too low compared to the true costs of creating these products sustainably. Not always, but many times low prices come at the expense of something, whether that be the planet or the quality, or someone. However, moving forward, pricing should be more focused on first-party data and developed around HOW your consumer engages with your business. A frequent consumer is more likely to be price-sensitive, however, their loyalty can be rewarded in line with this. Whereas, a less frequent consumer may be less price-sensitive and more 'experiential' in their purchasing. Pricing in line with your consumer's purchasing habits from first-party data, like loyalty schemes will help navigate this next season.

"I'm sure we are not alone in being placed in a difficult dilemma. We had to reduce our fees during the lockdowns of the past 18 months as our clients were themselves having cashflow trauma, and even though we have now increased our prices, they are still considerably below pre-covid levels. If this inflation figure becomes the norm rather than a 1 month blip, we will have no option but to increase our fees again, since we ourselves have rising costs which have to be covered from somewhere and can't be covered by reserves indefinitely. We do appear to have the perfect storm at the moment, an economy recovering from Covid, a complete lack of equilibrium between job vacancies and increasing unemployment and a Government which is looking to increase the tax burden rather than reduce it. Covid pushed the reset button on society in so many ways, I'm just not sure the economy has yet finished loading after Ctrl-Alt-Del."