Having spent Easter on a working farm, it was interesting to speak to the farmer about the horrific rises in costs he's experiencing. Rocketing costs present just the latest challenge for domestic food producers, following months of worker shortages.
His fertiliser costs have risen from £300 per tonne to £1,000 per tonne in 6 months, animal feed has tripled in price in 6 months and the cost of the milk he produces is now being sold to Arla for nearly double what it was a year ago. This is without the increase in fuel. All in all, these three things are hitting farmers hard and the cost to farm is still rising, especially since Russia invaded Ukraine, adding to the squeeze on agriculture.
Rising costs are hitting us all personally and our businesses. I drove to Blackburn and back last bank holiday weekend, and I cannot recall ever seeing the M40 and M6 so clear, let alone it being a Bank Holiday. It was very clear that people are cutting down on the journeys that they are doing and thinking twice before getting into the car. I'm sure that it won't just be car journeys that people will think twice before doing.
From the stats I'm reading, household spending is already starting to drop, and it's expected to drop by 20% this year, so thinking out of the box and enticing your customers to spend money with you over the coming months may well need some creativity on your part. We'll see how things progress this year but my advice to everyone is to be on top of your numbers.