Primark bosses have issued a warning to all of their customers that will impact them later this year.
As the cost of living soars and inflation rises, the fashion giant has announced that they will be increasing their prices on its autumn and winter collection.
As Manchester Evening News reports, Primark are preparing to make “selective” rises in the range, having avoided most pressures from inflation until now because global exchange rates fell in its favour.
READ MORE- Aldi issues urgent recall on garden furniture items over fire hazard warning
However, owner of Primark and Twinings, AB Foods have explained that because the US Dollar is strengthening and inflation is rising, cost increases will be forced.
Chief executive George Weston said: “Inflationary pressures are such that we are unable to offset them all with cost savings, and so Primark will implement selective price increases across some of the autumn/winter stock.
“However, we are committed to ensuring our price leadership and everyday affordability, especially in this environment of greater economic uncertainty.”
This comes as millions of businesses across the UK are having to make decisions about their prices.
Supermarket bosses have warned of the cost of food rising and the price of the energy that businesses rely on to operate has rocketed in recent months.
The costs of the raw materials and staff they need are also rising.
It has meant some choosing to pass on these costs to customers, though many are wary as this is likely to discourage people from shopping with them.
However, despite price rises, Primark argues that they expect to see its sales increase because it is opening more stores, expanding its so-called selling space by 10 per cent compared with the end of the 2019 financial year.
“As a consequence, total sales for Primark in the second half are anticipated to be ahead of the second half of the 2019 financial year, which was pre-Covid,” AB Foods said.
The company added that it has seen a fall in Twinings retail sales over the past six months compared with a year earlier when people were drinking tea at home.
But this was offset by the launch of new products in its Wellbeing range of teas. AB Foods’ pre-tax profit rose 131 per cent to £635 million in the six months to the start of March, as revenue rose by a quarter to £7.9 billion.
Mr Weston added: “This half-year sales and operating profit for the group returned to pre-Covid levels. Our people have responded well to the many challenges we faced.
“Our food businesses have once again proved their operational resilience and sugar had another strong period, building on its recent track record of recovery.
“Measures to mitigate higher costs in all our businesses have been taken and more are planned. “Primark delivered a significant increase in sales and profit, with stores now open and trading largely free of restrictions.”
Keith Bowman, investment analyst at interactive investor, said: “In all, inflationary cost pressures are proving an increasing headache.
“The lack of a significant online presence over the course of the pandemic contrasts with that of clothing rival Next, whilst economic uncertainty and geopolitical tensions continue to warrant consideration. On the upside, both overall group sales and operating profit have returned to pre-Covid levels.”
