Greetings boss says CARD prices will rise as inflation bites
Now birthdays are set to get more expensive! Greetings boss says CARD prices will rise as soaring inflation bites
- Card Factory said inflationary pressures have seen card prices already rising
- The company’s board ‘expects significant inflationary headwinds to continue’
- Bosses also revealed the hit they took from pandemic has almost been reversed
- The comments follow cost of a first class stamp rising by 10p to 95p last month
Birthdays are set to get more expensive, said a greetings boss as it revealed the cost of cards will rise amid soaring inflation.
Card Factory said inflationary pressures have seen card prices already rising and higher price points are expected to last throughout the year.
Bosses also revealed the hit they took from the pandemic has almost been reversed and they expect sales to beat pre-Covid levels by this year.
The comments follow the cost of a first class stamp rising by 10p to 95p last month, while second class stamps increased by 2p to 68p.
Royal Mail blamed the long-term decline in letter usage, coupled with rising inflation, for the new prices that came into effect on April 4.
Card Factory said inflationary pressures have seen card prices already rising and higher price points are expected to last throughout the year (file photo)
A birthday card costing £1.79 (pictured left) from Card Factory and a cheaper one from the retailer costing 99p (right)
Card Factory said: ‘As previously guided in January, the board expects significant inflationary headwinds to continue through (the current financial year).
‘Pre-emptive action has already mitigated a significant proportion of the identified inflationary headwinds through a combination of efficient management of costs and working capital as well as targeted price increases.’
The company added that there has been a shift away from a reliance on major peaks in business linked to national celebrations, including Valentine’s Day and Mother’s Day, towards everyday ranges of birthday cards and general greetings, which make up 70 per cent of sales.
Chief executive Darcy Willson-Rymer explained how the past year had seen an improvement, although the reopening of physical stores took a knock to online sales.
He said: ‘We saw a steady recovery in store performance as lockdown restrictions eased, particularly in the run-up to Christmas with store sales approaching pre-pandemic levels in this key trading period.
‘As we reopened our stores, we saw our online performance decline slightly year on year; however, we remain greatly encouraged that our Card Factory online sales were significantly ahead of pre-pandemic levels.
‘This year will see us make further progress in developing our customer proposition, through a broader product range and improved online experience, as part of our transition to a leading omnichannel retailer.’
Overall sales in the 12 months to the end of January were up 28 per cent to £364.4 million, with pre-tax profits hitting £11.1million compared to a £16.4million pre-tax loss a year earlier.
Card Factory said: ‘As previously guided in January, the board expects significant inflationary headwinds to continue through (the current financial year)’ (file photo)
Bosses also revealed the hit they took from the pandemic has almost been reversed and they expect sales to beat pre-Covid levels by this year
Store sales were up 33 per cent year-on-year due to an extra 20 per cent more store trading days as pandemic restrictions ended.
However, online sales fell 13.5 per cent on a like-for-like basis.
The company added it would not be paying a dividend until loans taken out during the pandemic, including the Government’s Covid-19 loan scheme, are repaid in 2024.
Meanwhile, Boris Johnson today acknowledged there was more that could be done to help address the cost-of-living crisis despite insisting the Government was doing ‘everything we can’.
The Prime Minister warned that increasing Government spending to prop up household finances could fuel inflation rising even faster.
On ITV’s Good Morning Britain, Mr Johnson was challenged about the case of a 77-year-old viewer called Elsie, who has seen her energy bill soar and cut down to one meal a day.
Meanwhile, Boris Johnson (pictured above) today acknowledged there was more that could be done to help address the cost-of-living crisis despite insisting the Government was doing ‘everything we can’
Told that she spent the day travelling on buses to stay out of her home and keep her bills down, he said: ‘The 24-hour freedom bus pass was actually something that I actually introduced.’
Mr Johnson said there are ‘plenty of things more that we are doing’, adding: ‘What we want to do is make sure that we have people who are in particular hardship looked after by their councils, so we are putting much more money into local councils.
‘We have the particular payments to help elderly people in particular with the cost of heating.’
The Prime Minister warned that increasing state support beyond its current levels could drive inflation even higher.
There is a ‘global context’ caused by a surge in energy prices which is hitting all aspects of the economy including food, he said, adding: ‘The cost of chickens is crazy.’
On energy, Mr Johnson said: ‘This country is in the insane position of having to take in, pipe in, electricity from France and elsewhere because we haven’t done enough to invest in our own security of energy and electricity.’
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