I suspect a lot of price rises we are seeing is due to the shear embuggerance and incompetence of customs and immigration. It’s probably OK if you are big business - eg supermarkets, but is a bloody nightmare if you are an SME - and most in the firearms / shooting industry fall into this category.
For one of my clients its six weeks to get products too and from the continent. These are electronic components made in the UK and within the EU. All paperwork etc filled in correctly. It’s just that smallish value commercial packages - c£30k are just being overlooked, whilst the big boys just muscle through.
And the cost is huge, especially if many are using cash flow / trade finance to fund order books. Typically this costs c4 to 5% per month. This is fine if the goods arrive within a few days of order. So a £10k worth of goods will cost £200 (2 weeks or so) to fund.
Now add 6 weeks and you are paying 10% cost. Thats £1,000 on £10k of orders. That hurts any business.
Or if the company is funding its own order book, then it still hurts hugely as cash is tied up. So when you have £30k sitting in customs, you are not going to be to use that cash until the goods are released and then payments flow.
And for companies these delays will mean one or more of the following:
- a need to increase prices to compensate
- reductions in margins / profits on each order / tranche of goods
- a reduction in overall turnover, given that cash keeps getting tied up, so number of orders per year is reduced
- no cash to allow business to grow and prosper - no growth in wages, jobs or taxes to government
Jacob Rees-Mogg will not agree, but fundamentally the UK shooting sector relies on imports and all the extra controls imposed on movement are really starting to hurt business.
Add to that Sterling is not very strong, no wonder the UK is suffering and we are seeing cost of products going up 14%.
But as I will be reminded - the UK voted for this mess.