The Brassica Growers Association (BGA) has warned that the proposed increase in the living wage presents one of the biggest challenges facing its members in the coming year.
In a post on the British Growers’ website, the BGA warned that, “the continuous use of sales and price promotion is not a route to salvation.” It pointed out that the drive for lower prices which is particularly noticeable during post-Christmas and Black Friday sales is at odds with the large number of vacant shops on the country’s High Streets.
“From time to time we need to pause and reflect on how this relentless driving down of price is achieved,” continued the BGA. “The margins for many commodity food suppliers are notoriously slim and yet year after year production costs continue to rise. The recent increase in the minimum wage is a good case in point. In their manifesto the Conservatives pledged to address the problem of low wages.
“No one would argue against the opportunity to earn enough to afford a decent standard of living. In April the living wage increases by 6.2%. For many fresh produces businesses where employment costs represent 30% or more of total production costs, finding this extra cash represents a big challenge.”
The association warned that a key shortcoming of many modern political systems is that they do not thoroughly explain “that for every upside there is usually a downside.”
Photo credit: British Growers