“Inflation hits families and businesses with full force in winter”

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Family entrepreneur Daithí O’Connor says the inflation clock is ticking loudly for both Irish families and small businesses.

r O’Connor – who runs the World of Wonder toy store in Cork and Kerry – warned that the full impact of spiraling inflation on families and family-run businesses will not be felt until next autumn.

He said Ireland must do everything now to mitigate the effects of rising fuel, labor and import-related inflation before the full effects hammer home from October.

“The reality is families and businesses are somewhat protected from fuel inflation as we move towards summer and warmer weather.

“Companies and private households are not so dependent on heating.

“But what happens next October when everyone is betting on gas, oil and electric heating, when the weather gets colder and we move into late autumn and winter? Then the full effects of the current price increases will be felt.”

The retailer said its company was already dealing with a more than 40 percent hike in diesel prices, a more than 30 percent hike in electricity prices and a threatened 40 percent hike in gas prices.

Some suppliers have warned that electricity prices will increase by a further 20 to 25 percent from May – putting enormous pressure on the budgets of families and family businesses.

“Light and fuel bills are already definitely up 20 to 30 percent from 2019,” he said.

Due to rising import-related inflation, his company had to absorb all of these increases without passing them on to consumers.

“We installed LED lighting to reduce bills. We are fortunate that we are not as exposed to heating costs as, for example, hotels and restaurants.”

Worse, companies are facing the specter of wage inflation just as they are struggling to fill vacancies left by the fallout from the Covid-19 pandemic.

“Everyone expected things to get a little easier once the worst of the pandemic was over.

“The sheer scale of the inflationary pressures hitting families and businesses has taken everyone by surprise.”

Mr O’Connor said his family business has already been hit by rising product import costs – from sky-high container shipping costs to higher wholesale product prices. In some cases, the shipping costs from China are three to four times higher than just a few years ago.

“Any importer had to pass these costs on to the consumer – there was simply no way they could handle increases of this magnitude.”

He said retailers were desperate to rebuild their businesses in the wake of the pandemic have largely tried to absorb heating and lighting costs stimulate consumer spending.

His toy company runs its own supply truck and is trying to offset higher costs from rising diesel prices.

“Companies also have a very, very difficult time recruiting staff. Some traders have been hit very hard by the inability to recruit the people they need,” he said.

“It will be October and November (when) the full impact of petrol, diesel, gas and electricity price hikes will be felt.

“I don’t think there will be another hiding place then.”

https://www.independent.ie/irish-news/news/for-families-and-business-the-full-force-of-inflation-will-hit-in-winter-41512829.html “Inflation hits families and businesses with full force in winter”

Fry Electronics Team

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