You’ve probably noticed prices rising, but do you know why? What’s behind those rises, and are the increases justified? Charlotte Brant, Purchasing Manager at iSB Group, finds out more…
We’ve all heard the headlines, and seen them being played out in our everyday life: prices are going up everywhere. Households and businesses are being squeezed financially from all directions. But why is this happening in workwear, and are the price increases justified?
You may have heard the reasoning: raw material costs are rising and manufacturers need to raise their prices to cover their costs. In turn, third-party suppliers must then raise their own prices to cover the shortfall.
But, with so much talk of price rises, it would be easy for a business or industry to jump on the band wagon for purely profit-driven reasons. So, how do you know if you should be paying more for your corporate workwear or PPE, or if you’re being taken for a ride?
First, let’s take a look at the facts…
Workwear price rises: what’s happening?
This is not a simple issue. The increasingly complex and interconnected nature of global business and society means there is no single factor to blame. Recent price rises, as well as the inevitable further increases yet to come, are being fuelled by a cocktail of factors.
Massively increased demand for workwear over the past 18 months has led to a shortage of raw materials, while global factors have impacted production and increased the cost of manufacturing and shipping.
These include:
Lead times are getting longer, which increases costs even further as organisations bid for priority in production and shipping.
Scarcity of raw materials
Increased global demand means many raw materials are in high demand yet low availability. The price of cotton is at a 10-year high and has increased particularly sharply in the past few months, while the cost of polyester fibres – linked to the price of oil – has increased by more than a third since this time last year. Demand for yarn is also outstripping capacity at the mills, despite them working around the clock to keep pace.
Production
Manufacturing and dye house facilities are in high demand and increasing their prices to cover rising costs to their own businesses. Some 90% of the chemicals used to dye fabrics worldwide are imported from China, leading to further delays and costs due to…
Higher shipping costs
Global averages put shipping container costs at 70% higher than this time last year, with the average cost of a 40ft container now more than double the five-year average. Shipping to the UK is even more expensive, with several of our suppliers reporting to us that they are regularly paying 10 times what they were pre-pandemic to ship the same products. Not only is shipping more expensive, it is also taking longer. Congested ports both abroad and in the UK, together with high demand and a shortage of containers and vessels, mean some businesses are waiting weeks to secure a space.
Workwear price rises: the importance of a strong buyer-supplier relationship
For businesses like ours – and those of our suppliers, who we know share our commitment to delivering high quality products at reasonable prices – this is a difficult time. No one wants to have to increase costs for loyal customers at a time like this.
If we have to put up prices, we are open and honest with our customers about what is happening and why, to ensure they understand our reasoning for the increase. We also give them as much notice as possible before the changes take effect.
Finally, we don’t just accept that price increases are an inevitable part of business. Our ethos means we are always striving to provide better products for our customers, whether that means switching to suppliers located in the UK and Europe to reduce the carbon footprint of our products, or being tough on our suppliers and the manufacturers they work with to be pursue innovations in materials and production methods that can improve quality and reduce costs.
If your workwear supplier is doing these things then you can be sure that, even if prices are increasing, you will always be getting the best deal you can. If not, then it might be time to look for a new one.
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