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I can put some perspective on how this is affecting prices. I work for a food-2-go supplies business, we sell packaging to coffee shops and the like. Most of
by Steve44 4y ago
I can put some perspective on how this is affecting prices.
I work for a food-2-go supplies business, we sell packaging to coffee shops and the like. Most of our products are UK made and although we don’t directly import anything a few of our suppliers do.
An example is one 40ft container will hold about 750 cases of 500 x 12oz double walled paper coffee cups, in 2019 would cost us about 30GBP per case wholesale delivered to our UK warehouse.
To ship a 40ft container from China into the UK pre COVID was around $1500-$2000. It started rising as COVID hit (for quite a wide number of reasons all combined) and last year it was peaking at $25,000, most of the year is seemed to be about $20,000. It has dropped over the recent few months,as the article says, but is still very high.
At $2,000 shipping per 750 cases out of the £30 cost that’s about $2.66 / £2.30 per case in container shipping costs. At the peak it worked out to be about $33 / £29 per case. You can see that doubled the UK landed price of the product and so our costs rocketed up.
- cheschire 4y agoDid your prices increase to maintain the profit per unit, or did your profit per unit increase / decrease after your price hikes?
- Steve44 4y agoWe have had to increase prices, but on most things aren't maintaining the normal percentage margin. We've really trimmed down on some products, which is making it tricky because our operating costs are going up too. Most people in the supply chain are doing the same, 'breathing in' and hoping we get through this mess.
- deelowe 4y agoI'm guessing they took a hit to margin, but even if you take the margin to 0, you're still not helping. Most companies who are in the business of importing/exporting goods are going to be in the sub 10% range. When shipping prices go up like they have, you're literally off by an order of magnitude. Single digit margin cuts isn't going to make a dent.