Nothing is Easy


Downhill Easy Riding

After almost two years I’m back on the bike and on the road.  This picture is of a hill near my home in the so-called flatlands of South Jersey.  I’m about to enjoy the product of my work to get up the darn thing.  The ride is how I react and respond to pressure.

Kaffe Magnum Opus just increased its prices, which was a very difficult decision to take as these times are not the best for our customers.  It was not easy.  But the costs to the company for quality coffee, expressed as the ‘differential’ in the coffee market, have sky-rocketed.  The company held its prices for a year, but now it must cover these increased costs. 

Our customers are now faced with the same decision.  To increase or not to increase their prices is the question.    If a retailer believes in their product and believes in their service, they can safetly cover increased costs by raising prices.  The belief will carry them through and their customers will stick with them.  Consumers are exposed to enormous amounts of current data on the economy and will understand the forces that drive prices.

My concern is the pent-up inflationary forces at work in our economy.  I lived through the rampant inflation orf the 70’s, – 1970’s that is.  It came from an expensive war being fought at the same time domestic programs were installed by President’s Johnson and Nixon.  Remember Price Freezes that the Federal Government initiated?  I do.   The US is fighting an expensive war, covering the bad debts of banks, and trying to stimulate a sluggish economy (not exactly sluggish for the folks in foreclosure, is it).  There is a risk of high inflation; the way to keep your business strong and healthy is to keep on top of costs and in some cases, like KMO’s, cover the increased costs with price increases.

One day though, you get to the top of the hill and look back.  It will all look easy then.

Oh philosophy – thank you Mr. Kirsch.

Bob

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