The official grocer to the Queen, Fortnum & Mason says that there is no getting away from the fact that price rises will happen during 2017. The plush grocer says that soaring prices caused by fluctuating Sterling values will definitely lead to price hikes next year.
According to chief executive Ewan Venters: “Retailers are nervous about the role of inflation, it definitely poses a threat and absolutely, prices will rise next year, there’s no avoiding it. We won’t be alone.”
He explained that although suppliers were based in Britain, ingredients and packaging components were sourced globally so were at the mercy of currency movements. While he said the upmarket firm would do its best to mitigate against that for customers, a degree of price increases was on the cards.
The warning came despite positive profits announced by the firm. Fortnums has announced a 27 per cent increase in its profits, meaning that profits were up to £6.2 million on sales of £98.7 million. A growth in online sales was said to play a large part in the improved profits.
Mr Venters also said that the weak pound was not all bad news as it could lead to a tourism boom in Britain, as well as opportunities to focus on exports which will be more attractive to other countries. He said these two factors could mitigate any economic downturn.
While he admitted that uncertainty as a result of Brexit brought challenges, consumers were looking for better value and quality when choosing to make purchases. The firm said it would be looking at opportunities across the globe. It believes that Donald Trumps shock election victory in America should not stop firms from exploring new openings and it is currently looking at a launch in New York. Many other firms, including Marmite maker Unilever have said they will have to increase prices in the wake of the Brexit vote.