Retailers Are Monitoring Situation In Middle East

Retailers are warning they may need to raise their prices if the unrest in the Middle East continues for a sustained period, says Retail NZ Chief Executive, Carolyn Young.

“Like many sectors, retailers are watching the events unfolding in Iran with concern,” Carolyn Young says. “The human impact of this violence is distressing and is also starting to have wider ramifications around transport and sources of fuel.”

“As we have seen before, when key shipping corridors are closed and oil supply chains are disrupted due to escalating tensions in the Middle East, New Zealand is not immune to the effects. While we are yet to see those impacts flow through to retail, if the conflict persists, it will begin to affect fuel prices and shipping costs.”

Ms Young says retailers do try to absorb small increases where they can, but their ability to do that is limited.

“Retailers have had an incredibly tough trading environment over several years. Many of our members are still struggling and cannot afford to absorb additional costs, particularly over a prolonged period,” Ms Young says.

"Higher prices are not what any of us want to see, but in such a tight economic environment, there is minimal ability for many business owners to cushion the impact of such a global crisis. It is inevitable that if this conflict continues for some time, some of those additional costs will have to flow through to the consumer.”

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