Shop price rises are on the way, BRC warns
By Sean Farrell
Date: Wednesday 01 Sep 2021
(Sharecast News) - Higher shop prices are on the way as retailers face rising costs from supply chain problems, Brexit and other causes, the industry's trade body warned.
Prices in stores fell at an annual rate of 0.8% in August but prices rose slightly from the previous month, the British Retail Consortium/NielsenIQ survey showed. The rate of decline slowed from 1.2% a month earlier and an average of 1.5% over the past year.
Price declines eased in all categories with the biggest change in non-food products which fell at an annual rate of 1.2% in August compared to 1.8% in July.
The BRC said prices of non-food categories such as electrical goods were rising sharply from a year earlier because of shipping delays and a global shortage of microchips. Rising commodity and transport costs combined with Brexit red tape are putting pressure on food retailers that will cause grocery prices to rise, the BRC added.
The UK is also suffering a shortage of lorry drivers, causing shortages of some goods and pushing up wages in the sector. The government has refused to ease restrictions on EU workers to fill the gaps left by drivers returning to their home countries because of Brexit and a bottleneck of new driver registrations.
Helen Dickinson, the BRC's chief executive, said: "Low prices are already under threat, and now the HGV driver shortage has created an additional problem with a shortfall of 90,000 drivers. Disruption has been limited so far, but in the run up to Christmas the situation could get worse, and customers may see reduced choice and increased prices for their favourite products and presents."
Dickinson called on the government to increase the number of lorry driver tests, provide temporary visas for EU drivers and change funding for HGV driver training. Lorry driving is a tough trade with high training costs and EU workers filled jobs that UK workers did not want for many years.
"Without government action, it will be the British consumers who will pay the price," Dickinson said.
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