Bracing for Price Hikes
Have you noticed prices going up? I first noticed it at the gas pump, then at the grocery store.
While I don't watch tv news with all those toothy "news" personalities, I do pay attention to serious reports about weather and political turmoil.
Years ago, I read about a particularly bad season for coffee bean growers. Within weeks, coffee jumped to all time highs. The same thing happened to sugar and rice (in different years).
During our recent pandemic when imports slowed to almost a standstill, Amazon's Lightning Sales funnel was nearly devoid of all products.
Locally, you couldn't find alcohol, hand sanitizer, or toilet paper. (Thanks, TP hoarders.)
Middle East wars tend to dry up oil imports. Weather can destroy entire crops or delay shipping. Pandemics can empty shelves almost overnight. Individually, these price jumps are inconveniences. When they start to form a queue as they have in these past few months, it makes me squirm.
I don't have any reason to squirm. We try to stay fully stocked, but even our inventory has to be replenished and that's where I feel the pinch. When prices jump it means I should've bought it last week.
Pay attention to global conflicts, weather patterns, and social instability. They all directly affect supply. The curious part is that everything is connected. Rise in oil affects shipping costs. An increase in plastic affects not just plastic wrap, but every container and package from bottled water to a package of cookies. It's going to affect your wallet either directly or indirectly. There's no getting around it.
Now that the pandemic is ending, more stores and restaurants are open, increasing demand for products and labor. What's worse is that it appears the four largest meat packers in the US are price fixing. The cattle producers aren't getting more for their cattle. The price jumps are coming directly from the meat packing industry, and they control 85% of the market.
And housing? It's skyrocketed. You can't buy lumber for any reasonable price because builders have accelerated demand. This includes the pulp industry which is the basis of all paper goods. Toilet paper to paper plates will go up if you haven't seen it already.
That said, you can't afford to sit on your hands and whine about prices. It's time to get proactive. While we can't go back in time for cheaper goods, you can invest now before prices get higher.
I always start with non-perishable goods. The last time paper products have gone on sale was in late 2019, so anything I buy now is bought at the going rate.
Will the price come down? I doubt it. In my experience, even when supply meets demand, retailers are in no great hurry to pass the savings on to consumers. They train us to get used to the new price, thereby setting new standards.
Knowing this, I do these three things.
- If I see a non-perishable on clearance (usually due to damage) I buy it.
- If it's sold in bulk (in units cheaper than the individual package), I buy it.
- And here's a little known tip: If you shop estate sales, non-perishables like these are often marked lower than what you can buy them for in stores--and they're often unopened. You can also find marked-down goods at flea markets, but don't buy unless you know the retail price first.
These are the non-perishables I look for:
- Paper towels
- Facial tissue
- Toilet paper
- Trash bags
- Plastic wrap
- Resealable plastic bags
- Bar soap
- Dishwasher soap
- Aluminum foil
- Hydrogen peroxide
- Kitty litter
I know these things will last just fine in a closet, under the bed, or in a garage. I've been doing this for over 40 years and credit this practice with saving me thousands of dollars over the years. But it only works if you're organized and up to date on pricing and trends.
None of this is hard to do and you can start right away.
- Clear a space in your closet or cabinet.
- Buy one extra of whatever product is on the "due for inflation" list.
- Do this regularly until you have a small stockpile.
In the long run the savings add up, and much quicker than you'd expect. Give it a try. It'll be worth it.
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