As supply costs rise, so must prices — or at least according to consumer products giant Procter & Gamble (PG). The US-based company known for its extensive product line-up that includes everything from Tide detergent to toothpaste mentioned to investors on its Tuesday earnings call that it’ll be raising prices for some products.
The price raise targets mainly grooming, skincare, and oral care products due to higher supply chain costs such as more expensive raw materials and a rise in shipping fees. With the company already having increased prices for other home and fabric care products previously, its latest Q3 2021 earnings showed slower growth. P&G’s managed to weather through the higher costs though as its net sales were up by 5% at $20.3b. The company expects raw material costs of $2.1b and shipping fees of $200m to significantly impact its full-year figures. P&G’s overall forecasts still seem optimistic though as it projects a 2-4% YoY increase in sales for this year.
why it matters
P&G’s share price has been a bit shaky with a 1.1% drop over the past five days, but a 0.4% increase at market close yesterday.