A lot of businesses were hurt by the pandemic and many of those companies...
Today’s post is by Troy Lowe; Vice President of Development at SafeSourcing.
A lot of businesses were hurt by the pandemic and many of those companies are still trying hard to get back up to speed. Lack of workers caused companies to cut back on production which slowed down supplies to the market and led to rising prices on about everything that we consume. Home appliances are one the thing that was affected. Lack of the materials needed to make these appliances is listed as the main reason for the increases that have occurred, and these increases are forecasted to continue throughout this year. Some analysts are predicting that they will increase by more than ten percent.
Now with the pandemic restrictions being lifted we are facing another crisis that will impact the price of items due to fuel costs. Besides the rising cost of manufacturing this new fuel issue will also affect the cost of appliances and other goods. The rising fuel costs further squeeze retailers, and they are forced to pass on the higher expenses to us the consumers. Anything that must be shipped could cost more as the price of fuel continues to increase. Also, many of the products contain plastic and synthetic materials which are petroleum based so the higher oil prices the more expensive these parts become to make.
Even though the price of materials has gone up and we have been paying more for appliances why have companies like LG been making record sales during these demanding times. Are they passing too much of the costs to the consumers? Last year, LG passed up the Whirlpool Corp. as the world’s top manufacturer of home, kitchen, and laundry appliances after posting record sales in 2021. Its home appliance and air solutions division had another record setting year with over twenty-seven trillion in revenue which is an increase of over 21 percent from the year previous. It seems that a lot of companies like this one have been retaining strong profit margins during the pandemic because they have cut costs and continued to pass the unreasonable prices to their customers. I guess with the pandemic and now the high fuel costs we need to start asking how long this can continue to go on.
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