Along with this increase, team members of the company are getting more in wages. “We are giving 10 percent raises to our team members,” Barlin explained. “With the Great Resignation, we want to keep our A players and we need to treat them the same way. They are being affected by inflation too.” The company has 16 team members.
“We’re often asked to not only finish the products but to also supply them,” Shirar explained. Supply chain issues have led the price of building goods to climb, and Shirar has seen building materials for his company go up at rates between 12 percent and 20 percent over the past year.
“Even things like paints and stains, and the internal resins and pigments that give them their colors, have increased around 10 percent year-over-year,” he added. “We just can’t absorb those costs.”
Customer reactions have varied. In Barlin’s case, clients were understanding of the price increase, she explained. For Shirar, there’s been no major impact on the volume of sales. The overall profit, even with the higher prices he’s charging clients, hasn’t changed. As he explained, “We’ve just had to spend more to make the same.”
“Six months ago we, sold 500 grams [of creatine] for about $20,” Jeff Moriarty, marketing manager at My Supplement Store, told The Epoch Times. “Now, that same product is nearly $50.”
Customers’ response to the price hike has been negative. “We have found the sales of this product drop by almost 50 percent, hearing from many customers that they are scouring the Internet looking for cheaper prices from companies that still have stock of their old inventory,” Moriarty said.
Hudson focused on keeping high-quality clients when she decided to raise prices to pay higher wages to employees. “A price increase helped me narrow down the clients who supported the growth of my business,” she explained. Those who weren’t happy with the higher price took their business elsewhere.
The motive for the higher sales may be tied to how customers view the company. “I believe the perception of value actually went up—just because we were more expensive,” Brown said.
“When businesses avoid raising prices, there’s always a sacrifice that has to be made,” Hudson noted. “Some companies downgrade their quality of products, while others refuse to increase employee salaries to keep up with inflation. Pricing strategies must be updated to maintain quality standards.”