I think we are going to hear an oft-repeated phrase in the next five years. That phrase will be “because we left the EU…”. I’ve just encountered it at a soft-furnishings store where the price increase on Egyptian towels was explained by the salesman who said “because we’ve left the EU the prices of cotton have risen, so we had to put up the price of towels”.
- But the UK hasn’t yet left the EU,
- suppliers in Europe cannot charge the UK different prices than other EU countries before the UK leaves the Common Market,
- … and Egypt, from where the ‘Egyptian cotton towels’ come from was never part of the EU anyway.
What’s going on here? It can’t be only the exchange rate as cotton and other commodities are purchased on a futures market so as to avoid vagaries in price.
I’ve a feeling that this will be just the start of this saga. Retailers by their very nature often have very thin margins and are at the mercy of the whole supply chain. Disintermediation in the form of eBay or Amazon who sell direct to the consumer have cut their revenues, and the Common Market meant that I could by parts for my aquarium filters at one-third to a half of local UK prices. And that is while we were in the EU! With the upheaval in politics represented by the EU vote a whole lot of things will now be blamed on this rather than the more prosaic explanation that sellers make profit whenever they can.