Food prices are declining, and saw their biggest decline in more than a year in June, where prices fell 0.8% according to the British Retail Consortium. Deflation which has hit the food industry moved to 2% year-on-year which has meant plenty of shoppers have benefited from the decline in food prices in their shopping budget.
The much talked about Brexit could have a large number or unintended consequences. We simply don't know yet what the long term impact of Brexit will have, but there is one simple calculation that can tell us what the short term impact will be - exchange rates.
Soon after the Brexit the value of the pound collapsed against the Euro and US dollar. This simply means our pound will buy less from abroad then it did, and essentially means more pounds need to spent acquiring food from abroad.Costs that will no doubt be passed onto the consumer. This is quite a big deal as 40% of food we consume is imported.
Should Brexit prove to be costly for importers, we start to see more locally grown produce, which isn't a bad thing, unless you absolutely must have pineapples and papaya. Although low food prices is generally a good thing for shoppers, it does put an enormous strain on supermarkets that quite often work in negative margins, and discount stores such as Aldi and Lidl have these sorts of marketplaces sewn up. Other supermarkets like Waitrose that don't compete on price (within reason) but compete on quality, range and locality may actually benefit as their exposure to exchange rate fluctuations is less.
If you want to find out more about the wide range of wholesale food that we have available at Benfell Ltd then don't hesitate to check out our online catalogue, or alternatively you can easily get in touch with us to find out up to date prices and any new ranges that have yet to be added to our website by competing our online contact form, by sending us an email to firstname.lastname@example.org, or alternatively call us on 01273 833641 where a friendly member of the team will be happy to help you with your enquiry and can even take your order.