While overall retail prices fell year-on-year, the British Retail Consortium said there was a sight rise in prices on the previous month and that there are some modest indications that rising costs throughout the supply chain are starting to filter through into product prices which could be realised as Christmas grows closer.
Between 2-6 August 2021, Shop Price deflation eased to 0.8% year-on-year in August compared to July’s decrease of 1.2%. This is a slower rate of decline than the 12- and 6-month average price decreases of 1.5% and 1.2%, respectively.
“Some of the non-food categories, such as electricals, saw sharp rises in inflation compared to last year, owing to global issues from delayed shipping and shortages of microchips,” said Helen Dickinson, CEO of the British Retail Consortium .”
“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.
“The Government must act swiftly and rapidly increase the number of HGV driving tests taking place, provide temporary visas for EU drivers, and make changes on how HGV driver training can be funded. Without Government action, it will be the British consumers who will pay the price.”
Mike Watkins, head of retailer and business insight, NielsenIQ adds: “The good news for shoppers is that shop price inflation remains below consumer price inflation and any moderate increases in prices are being driven by wider economic conditions and seasonal supply changes.
“With shoppers now returning from their summer holidays many will be reviewing their household budgets. So the next few months will be an important time for retailers to keep prices stable by absorbing as much of any increase in their supply chain costs as possible.”
The BRC’s warning comes hot on the heels of mum and baby products retailer JoJo Maman Bebe saying it will be increasing the prices of some of the products it sells as a result of the widespread supply issues.