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Consumer, Food & Retail Insights

| 1 minute read

Brexit set to add to UK food and drink inflation woes - what can your business do?

The UK government has recently announced that it intends to charge a flat-rate inspection fee of up to £43 on each food consignment coming into the UK from the EU. It looks as though these charges could be in full flow as early as next year and the industry has been quick to voice its concern.

The concerns are worsened due to already rampant food and drink inflation in the UK which in April was a staggering 19.1%, far outstripping the UK’s headline inflation figure. It’s true that food and drink inflation is high across Europe, but the UK figure is proving more stubborn and this announcement will do little to reduce it.

So, what can UK businesses do? Is it feasible to continue to pass price increases on to consumers without damaging sales, or can they look upwards at their supply chain and start including, or at least properly policing, contractual price increase mechanisms?

My colleague Ryan Harrison wrote a short, snappy paper on Contracting for Inflation (link here). Discussing the nuances of price increase mechanisms, it was penned in January 2023 with the expectation that, by now, rampant inflation would be on its way out. Not only is that not the case in the UK, but for those in the food and drink industry it could be more relevant than ever as the battle against inflation continues.

UK post-Brexit border charges will increase food prices, warns industry