The Beverage Standards Association brings you Peter’s Monday 28th June 2021 Weekly Briefing every Tuesday morning.
Monday, 28th June Weekly Briefing
The beast may be awakening. The Bank of England is warning that inflation will soon exceed 3%; in the USA it is already at 4.2%.
The headlines look worrying even though some (or even many) economists are saying the rise might quickly reverse. In the 1970s, UK inflation was running as high as 15%; for people with a variable rate mortgage – the vast majority – the result was that mortgage payments seemingly rose every month taking more and more of their disposable income. The government’s policy for some time had been to impose caps on wage increases. But this quickly frayed at the edges because it led to labour trouble resulting in the three-day weeks of 1974
A future await us
Is this a future that awaits us? And if it does, how concerned should we be for the foodservice sector? I hope the answer to the first question is “no”. As for the second, let’s look at how inflation has affected the sector. I have chosen to look at inflation in input prices of food, and because I do not have data specifically for the foodservice sector going back 50 years, I have used food inflation generally which is a reasonable proxy for changes in the price of food into foodservice.
Thank you for reading part of the Monday 28th June 2021 Weekly Briefing and full edition can be found at Weekly Briefing Report.
Peters Monthly Report for May 2021 is now available here.
Peter provides consultancy on the eating out market and opens eyes to brand new ways of thinking about the sector and its multiple opportunities for success.