Sir, I read your Leader (15 October, p3) with interest and in particular Dave Lewis’s comments about using exchange rates alone to justify price increases, which I can understand when applied to products where not all of the ingredients are imported. However, you only have to look at supermarket shelves to see the vast array of products packed at source abroad and therefore imported complete and ready for sale.
A year ago the pound was 1.55 to the US$ and today 1.22. That drop of 33 cents is 21.2%. However, if you divide any dollar amount by 1.55 to get a sterling equivalent and the same figure by 1.22 you will see the actual cost increase is a massive 27%. In many cases overseas freight costs have also risen sharply and indeed import duties have also increased in line with the weakness of the pound.
The reality is a massive increase in cost for imported goods and way beyond what any supplier could reasonably be expected to absorb given the small margins most importers were working on before the collapse of sterling.
Stanley Bernard OBE, group chairman, Sco-Fro