The Impact of Rising Price of Raw Materials on General Merchandise Retails

As raw materials are the most basic means of production for all kitchen utensils products, rising prices mean that raw material costs start to increase from the source of the supply chain. This will cause prices in various industries along the entire chain to rise, and production and operations will be affected.

The rise of the price of raw materials has led to the rising costs of products in most industries, which will eventually be reflected in the retail sector. That is, sales will be conducted through channel vendors and retailers. Although for the retail industry, in response to the rising price of products in the upstream supply chain, it can only adopt the measure of rising cost correspondingly. But now, the main issue is whether consumers will accept it. In the current downturn in the market itself, the sharp increase in prices of kitchen utensils and gadgets will put more significant operating pressure on all retailers involved in price increases.

Ⅰ. The rising prices of raw materials cause increasing kitchen unit price and decreasing sales

This price of wholesale general store products increase is not caused by short supply, and market consumption is not ideal. Many industries, especially those involving price increases, such as the home appliance industry, are entering the traditional off-season. At this time node, the retailers still adopt the price increase strategy, and even the price increase is relatively significant. Therefore, consumers are very unacceptable about it. And they will continue to wait and see, waiting for further information on the price.

Ⅱ. Rising prices of raw materials elevate the procurement cost of general merchandise kitchen utensils retailers 

The prices of many popular kitchen utensils products are volatile. From the supply chain kitchenware products manufacturer to distributors and retailers, almost all of them have minimized inventory. That is, there is no inventory. Regardless of whether the products are sold or not, there must be an inventory of essential products so that price increases will increase the procurement cost.

As long as the supply shortage does not cause the price rise in raw materials, almost most industries will be affected. The most directly affected one is the manufacturing industry. Especially the industrial product manufacturing industry involved this time. However, in the next stage of price increase, processing companies in the entire industry chain will be affected. And price hike will finally be reflected at the retailer level, and consumers will not immediately accept a price increase. Instead, they choose to wait and see. As long as the market does not start, the entire industry chain will be affected.

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