Image by Glynlowe.com
Consequences of Brexit | As the consequences of the UK’s decision to leave the EU become apparent and with market volatility continuing the price of many parts we purchase as a business or as consumers will be increasing. Strada purchase a number of components in Euros and US Dollars and (like everyone else) we have seen the exchange rates drop so we have to pay more for the same goods. These price increases will inevitably be passed to customers. We can absorb some increases but a 10-15% rise in the cost of goods overnight cannot be sustained long term.
UK distributors (they import bikes / parts / clothing from the manufacturer) work on a longer time frame than us and have already placed and maybe paid for orders for the 2017 season. The Brexit victory caused a shift in exchange rates which can be countered by monitoring and purchasing other currencies in advance and fixing the price but at some point these fixed reserves will run out and they will need to make purchases at the new lower rates. Now some of the day to day ups and downs can be absorbed but eventually you will see the price of parts and bikes increase as they pass the weaker exchange rate on to retailers and consumers. Expect to see price rises for high end brands into the 2017 season as new stock arrives in shops.
The upside is we can use a weaker GBP to our advantage and look for sales back to Europe and further afield to compensate.