British clothing costs are now the highest increase in 20 years, affected by China’s labor disputes

the seemingly unrelated RMB appreciation and labor disputes in China have dealt a heavy blow to the British clothing industry. According to the financial times, clothing costs in the UK will increase by the most in more than 20 years due to factors such as UK debt and labor disputes in China

the Financial Times quoted retail research firm verdict as forecasting that clothing prices in the UK will rise by 4.4% this year, the highest level since 1986. Neil Saunders, director of verict consulting, said that although this would bring additional pressure on consumers, clothing prices could not fall forever and would only rise in the next few years

the report points out that consumers have been used to low clothing prices, and the reduction of personal income due to fiscal tightening measures will aggravate people’s worries about the inflation rate. A leading UK retailer executive said that the price of the whole industry will inevitably rise

due to the reduction of orders from the United States last year, British retailers have “taken advantage of the opportunity” and reached a competitive agreement with Chinese suppliers, which offset the rising costs brought about by the devaluation of the pound. But now China’s labor disputes have increased wages and labor costs, squeezing the preferential space

Luca Solca, an analyst at Sanford C. Bernstein, points out that British retailers are suffering from the “pinch” of the devaluation of the pound and the appreciation of the RMB

in fact, it is not only the UK, but also the American consumers who have always preferred “made in China” are facing the end of the era of high quality and low price. A U.S. retail executive said the appreciation of the yuan, higher commodity prices and higher wages for Chinese workers all contributed to the manufacturing costs of Chinese products, Reuters reported. As China’s infrastructure and employment force have reached a certain scale, there will not be a large number of enterprises withdrawing from China, which will cause western consumers to pay higher prices for clothing and electronic goods

but when British consumers sigh that goods are no longer cheap, they should pay more attention to their “consumption tax”. According to the UK’s fiscal tightening plan, the consumption tax will rise from the current 17.5% to 20% from Januar4, 2011, thus increasing the tax revenue by more than 13 billion pounds. Some analysts pointed out that this will cause retailers to either digest the costs themselves or transfer them to downstream suppliers, while consumers will be affected

Author: Dong Dong

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