The price we have to pay: Australian businesses reveal
- 48% of businesses say they will not raise prices, primarily due to the desire to retain customers.
- One third of Aussie businesses are set to hike the price of goods and services over the next three months.
- Qantas and Uber have already moved to increase the price of services to accommodate record-high fuel prices.
Aussie businesses focus on customer retention will be a priority over raising the price of goods and services, according to new data released by the ABS.
Almost half of Australia’s businesses (48%) have said they won’t consider raising the price of goods and services over the next three months.
Of the businesses not considering an increase, nearly 50% said customer retention was a priority, while 46% could rely on fixed-price contracts.
Meanwhile, more than one in three (38%) of all businesses in the country expect to raise their prices by more than usual over the next three months.
Of the businesses planning to raise the prices of goods and services, almost all (92%) attributed the costs of products or services used by the business as the primary reason for doing so, while the rising cost of fuel/energy also rated highly amongst those surveyed (78%).
More than half of all businesses in manufacturing, construction, wholesale trade and accommodation industries plan to raise prices of goods and services over the next three months.
On the other hand, retail trade, transport, postal and warehousing, and financial and insurance services industries are expecting to ease price hikes over the next three months.
Australia’s national carrier, Qantas, is one company preparing to ‘rebalance capacity and fares’, as a result of the sustained increase in fuel prices. The flying kangaroo said domestic services in July and August will operate at 103% of pre-COVID- levels as opposed to 107% of pre-COVID levels as was in June. Qantas plans to add 1% to air fares for every $4 jump in the price of oil.
In March, Uber announced the roll-out of petrol surcharges across Australia amid record-high fuel prices for drivers.
Almost one in five businesses have planned capital expenditure over this time.
For the 18% of businesses who have planned capital expenditure over the next three months, 25% attribute future economic uncertainty as the most common factor for CAPEX plans.
The one-line takeaway: Almost 50% of all businesses in the country are NOT planning to raise the price of goods and services over the next three months.
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