Price Increases: How To Cope

Sudden and significant price increases have had a major impact on the distribution industry, as most everyone is aware. Last year at this time, distributors were largely optimistic that price increases that were being passed onto them by suppliers would level out ... or even reverse sometime in 2005.

Fast forward a year, and the market is still smarting from the high cost of raw materials, which has been exacerbated by Hurricane Katrina. Internal business costs such as health care and energy costs continue to compound the problem.

To deal with the “trickle-down” effect of all these price increases, distributors typically turn to tried-and-true measures to make up the profit. Fuel surcharges are still a common “quick fix,” and distributors constantly toy with value-added services.

In this month’s cover story, “Trickle-Down Times,” freelance writer Kassandra Kania explores the state of price increases, and talks to distributors about different tactics they are using to cope with trickle-down cost.

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SM editor Seiche Sanders alluded to it in her January “Editor’s Note.” At that time, it was a baby “on the way.”

At 7:45 a.m. on February 1, 2006, a healthy, seven-pound, seven-ounce girl named Callan Brynn entered the world — on her actual due date. How’s that for a deadline?

Seiche will return to the office sometime in early May, but until then, I will be the primary purveyor of news, trends and issues affecting the jan/san industry.