Concerns among bakers: “You can’t keep increasing the price all the time, then the bell will pop”

Concerns among bakers: “You can’t keep increasing the price all the time, then the bell will pop”
Concerns among bakers: “You can’t keep increasing the price all the time, then the bell will pop”

Higher energy prices. We all notice it, and perhaps bakers in particular. There are great concerns in the municipality of Groningen.

“I was able to conclude a new contract just before the summer holidays,” says Henk Post of the bakery of the same name in Ten Boer. “It sounds crazy, but I’m glad I did, because if I had to enter into a contract now, the end would have been completely lost. Yet the price in my new contract has gone up four times. Nowadays you hear stories that it goes upside down eight to ten times. It is very worrying.”

“Raw materials have also become more expensive”
Post does not want to say what amounts we are talking about. “But take it from me that it is a lot of money. And meanwhile, the raw materials I use have also become more expensive. So you cannot avoid the products in your store becoming more expensive. I cannot make a loss on my production, because then it will soon happen to bakery Henk Post.” Post also talks about a dangerous circle. “The government now wants to apply purchasing power repair in 2023. That sounds sympathetic. But depending on the situation in the world, energy prices will continue to rise. If you keep repairing constantly, it will add up all the time, and eventually that bell will pop.”

Bakery Haafs: “Price has become three times more expensive”
Also worries in Haren. Wilfred Haafs runs a bakery of the same name there. “We have somewhat of an agreement with the supplier in which the gas prices are determined on a quarterly basis. The third quarter was not too bad for me, although you are talking about a tripling. But there are many uncertainties. What will the coming winter do? Will it be a tame winter or will it freeze very severely? What will happen in Ukraine? Is Russia going to supply gas to Europe again via Nordstream 1? And what will the economy do? Are we in a recession? If so, the demand for gas and electricity will decrease, causing prices to fall. Will the transport of grain from Ukraine remain possible? The situation is very uncertain.”

“You shouldn’t go under”
Haafs does not want to be surprised. “I don’t like sleepless nights. I have made my own calculation model in which I can calculate what awaits me in terms of gas and electricity prices. That way I can prepare for what’s to come. But you cannot avoid implementing a price increase in the products you sell. We have done that, and we have also lost part of our margin. You can’t keep calculating everything. We would like to sell good bread. You have to be careful with which costs you are going to charge. But you shouldn’t go under either.”

“A recession is coming”
Last week, measures leaked from The Hague with which the cabinet will attempt to maintain purchasing power. Haafs about this: “You already said it: maintaining purchasing power. It’s not about us. We as retail and middle class are not mentioned. So I hope for a second round, where we will really work on our protection. I’m afraid a lot will happen in the near future. I also think a recession is coming. But how heavy will it be?”

“First signs of recession already visible”
According to Haafs, the first signs of a recession are already visible. “In construction, the orders are already drying up. White goods companies are already giving up. And look what has happened in recent months. After two corona years, everyone had to go on holiday. People have enjoyed it to the fullest, while holidays were not cheap. A lot of money has been spent. And now everything is getting more expensive. Where people fall steeply backwards from their energy bill. There is less to spend, and we as entrepreneurs notice that too. People are really much more careful about spending. The cut is held on the stock exchange. And that ultimately leads to a recession.”

“I lay awake at night”
Post in Ten Boer also hopes that the cabinet will take action. “If nothing happens, things get out of hand. When you go to the supermarket you notice very clearly that everything is becoming more expensive. That cannot go on indefinitely. We have to go back to the pre-war price situation in Ukraine. But how should we do that? These are very worrying times, where I am not currently awake at night, but I have had such nights in the past period.”

The article is in Dutch

Tags: Concerns among bakers increasing price time bell pop

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