Now's the time to raise prices If you were thinking about raising prices, now's the time. Consumers are expecting to pay more for whatever they buy. Whether it's gasoline, food, airline fares or anything else remotely connected to rising energy costs, especially oil. Consumers are paying more for fuel so they know everyone else is, too, from retailers to manufacturers to farmers. ABC News reported that food prices are going through the roof with eggs up 33 percent, milk up 5.6 percent, chicken up 6.5 percent and beef up 12.8 percent. A mother in Phoenix lamented on "ABC World News Tonight" that her weekly food bill has just about doubled from $70-$80 per week to $150. Scott Nennett, owner of Bennett Homemade Ice Cream in Los Angeles, told an ABC reporter that the price of the ingredients in his ice cream has gone up 20 percent in four months. He is expecting to raise the price of a cone by 50 cents this summer to cover the higher costs. Bennett's not happy about having to raise his prices, but as he told the reporter, "You have to make a certain amount of money to operate a business. So if the costs go up, so does the retail end of it." Prices going up, with one catch Federal Reserve Chairman Alan Greenspan told Congress in April that even while inflation remains low, strong economic growth has allowed some companies to raise prices. And it looks like more companies are jumping on the bandwagon. The Wall Street Journal reported that paper good manufacturers will raise their prices, including paper cups, paper towels, tissues and toilet paper, by 4-6 percent this summer. Procter & Gamble, Kimberly-Clark and Georgia-Pacific, the big three U.S. paper good manufacturers are paying more for raw materials just like most other producers. Company officials believe the improving economy will enable them to pass along some of those higher costs to retailers and consumers without losing market share. All of the companies said they have cut costs to address the higher prices they are paying for natural gas, up 48 percent since December 2002, and wood pulp, up 21 percent. Dave Dickson of Kimberly-Clark told The Wall Street Journal that although consumers don't typically like price increases, they'll go along with them if they are explained and justified. Market analysts say there is only one catch in whether other manufacturers will follow the price-increase movement. How will Wal-Mart respond to the increased prices? The world's largest retailer is considered to be one of the major factors in whether prices will be allowed to rise. If the retailer decides to hold the line on the price of its in-store products, which usually run 15-30 percent cheaper than name-brand products, then the price gap between the products could widen even more and cost manufacturers a loss of market share. But analysts point out that most manufacturers wouldn't be planning to raise prices without receiving some type of approval from retailers. Costs of raw materials for horticulture product manufacturers and growers are rising. The price of steel, a major component of greenhouse structures, has risen 15-60 percent this year. Prices are expected to continue to go up as China continues to purchase large quantities of the metal to meet its escalating manufacturing needs. So consider this your opportunity to initiate price increases with your customers whether you're a wholesaler or retailer. And if you're selling to Wal-Mart, chances are you'll be singing with the choir. Send this article to a friend Enter your e-mail address: Enter your friend's e-mail address: Click the image below to send: © 2004 Branch-Smith Publishing