Trading Update

Trading Update including Costs and Freight 21/04/2021

Hopefully, we are on our way to the end of all restrictions. With the vaccine now being administered all over the world, we can hopefully look to a brighter future for everyone.

It has been a real roller coaster ride throughout this pandemic, and we are glad that now all our retail customers can open and trade.

As you are aware trading has been challenging and we have made every effort to get stock in asap, where possible, even with the very high freight costs and the lack of space on the ships.

Cost Prices

We have been ordering more stock than we have ever re-ordered for this time of year, most of which is due to arrive from the 1st May.

Unfortunately, every new order we have placed for months has had price increases, ranging from 10% to 40% because the raw material and packaging costs have increased, and the Chinese currency the Reninbi (Yuan) has lost 10% of its value against the US Dollar.

Freight

However, our biggest issue is still the freight, we were hoping this would start to come down over the coming months but because demand is high as world economies start to reopen and the Suez Canal incident this is not happening. Freight is going up again and space on the ships is also becoming more difficult to secure, with a lack of empty containers in China compounding the issue.

Prices

Originally, we were hoping that the freight prices would have started to fall by now and we could start to reduce prices, but instead freight prices remain very high and substantial cost prices increase are happening so I have to warn you that we are expecting to have to increase prices again.

We feel we can absorb the increases up to the 27th June but anything arriving after this date we have no alternative but to increase, unless freight falls substantially before the goods are shipped which is about 6 weeks before arrival.

This means if stock is not in our warehouse before this date any orders on our system will have to be requoted.

I am unable to give you an indication of what the increase would be yet, this will depend on freight prices. I will try and give you as much notice as possible.

I am truly sorry I may have to take this course of action but again it  really is out of my control.

If you wish to discuss this, please do not hesitate to contact me.

Sergio Tartaglia

Managing Director

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