Inflation: How is your business dealing with it?

[TCSlaguna]

Hello everyone! 

With the U.S. inflation rate accelerating to a 40-year high of 7.5 percent, I was wondering: 

How is your business dealing with inflation? 

How much have your input costs increased?

Have you increased your prices to account for inflation or have you kept your prices the same? 

Has it caused you to look for alternative vendors? 

@homeprogreen @keicollective @DinaLRosenberg  @JessPoynter @HC_Charlie  @ginawood  @egpcrafts  @soycandlesbytas @MudFire_Dex  @TOTSC  @specialtiesgame  @JupiterGames @GourmetOnWheels  

[Twpchair]

That’s the thing hun most don’t get it until you break it down like you did and show them I went from example 100.00 to now paying 400.00 so somewhere along that line I can only absorb so much than the rest has to be passed on. It’s a shame because people are wanting to get out and shop and go to mom and pops type businesses than we get hit with this. Our sales have increased this year so far and I am grateful and hope everyone keeps shopping small! Good luck to you and a great 2022!!!!

[rtfulk]

We direct import so we haven't had to raise any of our prices, we also pre-pay for freight space. So if the price goes up we are locked in at a certain price.

What really gets me is the companies like Sezzle. They sent an email out a couple of weeks ago 6% plus .30 per transaction, we have stopped taking Sezzle, in my opinion that is way to much for me to pay so someone else can pay for my product over time.

[TheRealChipA]

My costs have not increased as much as many others.  Last year we could see the handwriting on the wall, and overhauled our business model.  The best change we made was to focus on our ice cream and beverage business, and completely eliminate the food component.  From all we could see, the pandemic was going to completely upend the food service business, and it turns out that was a lucky guess!  Our biggest cost increases have been utility rate increases and shipping/freight charges, though we have seen more modest cost increases across the board.

Before inflation started, the pandemic had caused us to expand our vendor and manufacturer list.  Now, for most products, we have multiple vendors and brands that we watch closely.  When cash flow allows, we go ahead and purchase ahead, stocking up on products when the prices are good or we can see a tightening of supply.  We open in a few weeks for our 2022 season, and I estimate that we have pre-purchased enough at decent prices to keep us going for at least the first 2 months of the season.  That gives me room to watch the market and stock up when prices are good.  It’s more time consuming to manage all of these vendors/manufacturers, but I’ve been rewarded for that effort on more than one occasion.

This year, we have only raised prices a little.  We made the decision to take a cut in owner draws in order to keep our prices stable without cuts in other places (like labor).  It’s going to be a sacrifice, but we are already getting positive feedback from people who are seeing our new menu and who notice that we aren’t following the pack in exorbitant price increases.

Right now, it’s a juggling game and I have lots of balls in the air.  But it is working, and hopefully I’ll be able to continue it.  One last thing.  I’m pretty sure that as supplies allow, I will run up my line of credit this year and go ahead and pre-purchase most of my non-perishable inventory that I project I will need for the season.  Energy prices are only going up for the next 6-12 months, which means that shipping and utility costs will only rise more.  I’ve built my guesses into my proforma for this season.  Hopefully I guessed correctly!

The debt doesn’t bother me because it will be short term, and it is product that I would be buying anyway.  At least I’ll have the peace of mind knowing exactly what my CoGS will be, and I won’t be so susceptible to supply issues and bottlenecks, not to mention shipping bottlenecks.

[Bronze_Palms]

In my salon, we purchase 6 months worth of single-use products at a time. Thankfully, we have not had to restock since the huge jump in prices. Some of the brands I use regularly haven't raised their prices in over 3 years so I feel like an increase of at least 10% is coming. I wouldn't be surprised if companies start charging for shipping again.

[Stacelyn24]

Soooooo over inflation at this point lol 🙂

We’ve had to increase salon service prices to cover the growing cost of inventory.  Here’s an example...a box of our soak off wraps that we use to soak off gel polish used to be $9.99 (and this is after I’ve researched vendors with the cheapest cost but not cutting quality)...and in two weeks it has gone up to $17.99 (ugh).

Now we usually need at least 20 boxes in each order so this cost along is significant.  Plus, we’re having a hard time getting inventory in.  We didn’t increase the price as much as we needed to to pass along to clientele...we decided that we would take partial hit and cover parts of the increase.

[Twpchair]

It’s the same for me in retail furniture I order 12 hoping to get 2!!! I’m being told at the warehouse they can’t hire fast enough but it’s still not coming from the marker because they are short staffed as well so who knows I just know our prices vary from 2x to almost 10xs what it use to be and I hate after all these years to cut quality of what I am buying but we can only absorb so much and the rest has to get passed onto the customer. One nice thing about all of us being small business owners our customers know what is going on and still come back and still choose you over someone else 5.00 cheaper. Here’s to a better 2022!!!!

[MzNikka]

As a Cosmetologist, my business has definitely been affected by inflation. I have such a wonderful customer base. I did have to increase my prices by $5 the customers were ok with that, they felt I should of went up more since I haven’t had a price increase in about 5 years, but now with the supplies going up 🛗 had to be able to purchase to keep my business up and running 

[Twpchair]

We’re in the same boat as far as having to raise our prices and our customers certainly understand and we have had no problems there selling I’m in retail furniture and decor our biggest problem is getting what we need! We order 12 hoping to get 2 and that’s a nightmare if not and it doesn’t come in that leaves me driving and calling all around to find the supplies we need that’s our biggest problem we are facing. That and in increase in cash sales vs cards. I know most people say cash is king but my location leaves us as a prime target to be robbed 😢 we are 1/4 of a mile from 3 interstate connecting so if anyone has a suggestion to promote more cards vs cash I would love to hear it! Good luck to you and hope you have an amazing 2022

[alexandriak]

My tags have increased 43% from Feb 21 to Feb 22. I'm trying to make sure the items we are taking in are ones we can price a little higher and limit the lower end priced items. I'm also looking for ways to improve my margins, and of course being smart with spending. 

For supplies I try to order as many as I can at one time so I don't have to reorder each month and deal with slightly higher prices. This seems to happen more often with our bags, so I'm going to be placing an order here soon for 6 months worth of bags at a time. This will also help me save on shipping costs.

[weredoughcookie]

We are a brick and mortar bakery. We have had to raise prices on items $.25 to $.50 for most items. and if inflation continues it will be the same hike this time next year.

We were trying to resist it but in the last month nearly every one of our ingredients finally jumped up significantly in price to the point we couldn't ignore it anymore. Before we were just cutting back, buying in bulk, or buying from a cheaper vendor. There's only so much of that you can do though.

[Robert76]

I have raised the prices on my rings for the first time but it hasn't affected my sales so far.  I only sell at pop-up shows and

such so don't have to worry about the high shipping costs.

[PM1973]

For Shadows in the Dark, the items that have changed the most are the Gift Items that we sell on our website. Our Braille Products and Services have not changed that much. The only items within the Braille that have increased the most are the Braille Games we do by hand.

https://www.shadowsinthedark.com/

[Bronze_Palms]

I have tried to add-value with every price increase. The price increases are due to inflation and will also help support the growth of the business. We expanded from 90 sq ft to 900. Clients saw it coming. I purchase about a years worth of supplies during our busiest month of the year and it "locks in" our price so we won't feel the true ramifications of inflation until that October time comes around when we need to reorder