Unilever warning suggests inflation looming for beauty products
After releasing its Q3 results, the boss of consumer products giant Unilever has issued a warning that suggests beauty and personal care prices are set to rise.
Unilever’s Alan Jope said the firm and shoppers face a “once-in-two-decade” backdrop that means prices in almost every product category the company sells are going up.
A big chunk of its offer is in the foods sector but beauty and personal care is actually the biggest division for the company that owns brands such as Dove, Lynx and Hourglass.
The group has been passing some price rises on to consumers with price rises of 4%+ in the past quarter. But Jope said costs are rising for resin plastics, paper, transport, labour, energy and ingredients.
While the latter is clearly a crucial issue for the beauty industry, the fact that its costs to package and deliver its products, as well as staff costs, are also on the up adds further pricing pressure.
Jope said the cost of palm oil — of which the group uses a million tonnes annually in its soap and moisturising products — has soared 82% in two years linked to Indonesian labour shortages. And in mature markets such as the UK, it’s now costing the firm more to recruit and train delivery drivers.
He also said the firm hasn’t “reached peak inflation yet”, despite price rises already being seen in Britain.
There have been suggestions that UK inflation — which is currently a little over 3% — could get as high as 5% at the start of 2022.
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