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Thread: Increasing costs and our prices ....

  1. #1
    Join Date
    Apr 2007
    Location
    UK
    Posts
    167

    Default Increasing costs and our prices ....

    We're sorry to have to report this but Harbeth is facing significant material costs during 2007-8 rises after many years of relatively stable costs which allowed our (UK) selling prices to have been fixed for two years. As fuel and transport costs have escalated we declined to pass these on as we anticipated that they would fall again as fuel prices dropped back. Costs have not reverted. We have become more aggressive with our suppliers but as a small company there is a limit to how pushy we can be with suppliers before incoming material quality deteriorates. I'm sorry to advise then that we must reluctantly pass on about 3.5% cost increase and have a new price list effective 1 December 08.

    This level of cost increase does not fully cover the actual cost increase but we feel is the limit of what we can hope to ask for in the present circumstances. As Alan has said, we are here for the long run and even this small adjustment definitely helps us. Thank you for your understanding. Harbeth remains the best value long term speaker investment you can make with a very long service life.
    Harbeth PR,
    Harbeth UK

  2. #2
    Join Date
    Jan 2006
    Location
    South of England, UK
    Posts
    4,135

    Default Re: Increasing costs and our prices ....

    I'd like to add something to this. We've considered this cost issue for months now. Not only do we have the rising cost of materials but of currency devaluation. In the summer, we were buying essential materials at a ?1 = $2 (one UK pound equals two US dollar). Today, ? = $1.48. That means we are having to pay about 35% more for critical materials now compared with during last summer.

    As I was not willing under any circumstances to cut quality to cut price, as I watched the UK pound weaken through the Autumn I decided to order, pre-pay and stock-up on at least one year's worth of critical material parts. That included the specialist steel parts in our drive unit magnets. The cost increase in steel alone is shocking. Most of the ordered stockpile has just arrived, some parts are still at sea. This stockpile gives us a cost-buffer. Perhaps we are unique in having the willingness and ability to lay out our own money in long-range financial commitments to insulate our prospective customers from severe cost increases.

    The weak pound does have the advantage that it stimulates export sales though. I really hope that our overseas customers will benefit from the weakness of the British Pound whilst the good times (for consumers) last.
    Alan A. Shaw
    Designer, owner
    Harbeth Audio UK

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