Let’s Hold Those Price Increases for Now

With many of those ‘green shoots’ in the economic recovery turning into small gardens, suppliers coming out of a period of poor revenue and depressed margins may try to spring a price increase on unsuspecting customers. Hold the line!

In September, U.S. consumer prices rose just 0.2%. The U.S. Labor Department’s Consumer Price Index (CPI) showed a year-over-year decline of 1.3%. They are worried about deflation and that shows we have a way to go before we begin to worry about inflation. Show your suppliers this data and ask for their pricing justification. I’ll bet many will have a hard time showing it.

Now is an excellent time to negotiate long term pricing agreements. Most suppliers are willing to lock in longer-term commitments because of market uncertainty. Trade that commitment for aggressive pricing. It will not be long until capacity begins to fill and prices begin to go up. Now is the time for action.