I have been notified by one of my service providers of a price increase for their service.
I find the reasons behind this increase quite informative and leaves more questions than answers.
Below I have quoted the hypothetical questions and justifications for their increase.
Why are you increasing your prices?
“Due to inflation, which directly impacts of running our business, we’ve had to re- evaluate our prices and introduce an increase from 10 April 2013.”
Where did this increase come from?
“We’ve used the Retail Price Index (RPI) which is currently 3.3%. This is a measure of the increase in prices for consumers and businesses on average across the country over the last 12 months.”
It makes me wonder and begs the question, Could we send a similar letter to our employers and the government for increases in pay and benefits based on the effect of the RPI on our businesses?
Price increases are a ‘one way street’, when used in a commercial environment, passing on increased costs to the consumer protects margins and share holder investment.It is the easy option and fuels inflation rather than using a more reasoned approach of trying to take cost out and not use the public as ‘cash cows’.
They are also responsible for the second part of their pathetic excuse of increasing the RPI for both businesses and consumers.
My message to this company and others that are predisposed to taking similar action is to get off of the merry-go-round.