In January, U.S. inflation started high and has bounced up and down throughout the year. According to the U.S. Bureau of Labor Statistics, inflation hit a 40-year high of 9.1% in July. By October, the inflation rate dropped to 7.7%, but was still well over the 1% to 2% inflation seen each month for most of the last decade. With high inflation rates forecasted into 2023, here are three areas retailers can address to avoid the price pinch.
MANAGE COSTS. “Every overhead cost the business pays for—whether it’s paper towels for the kitchen, snacks for employees or the electricity bill—gets more expensive with inflation. You have to watch those purchases closely and save money where you can.” —Gary Pittsford, chief valuation officer for Creative Planning
MONITOR MARGINS. “To keep up with the current inflationary challenges, we are hyper-focused on operational efficiencies, closely monitoring the cost of goods, rounding up where we can to save margin and passing on price increases when it’s possible and appropriate.” —Gina Schaefer, owner of A Few Cool Hardware Stores
STAY AWARE. “It is critical to pay attention to inflation rates and price changes. It is a definitely a high priority for us; we have people on staff who are dedicated to monitoring these areas for us. The financial success of our business depends on it.” —Buck Hurst, owner of Buck’s Ace Hardware