Inflation poses new challenge for pandemic-weary businesses | Illinois news

Inflation poses new challenge for pandemic-weary businesses | Illinois news

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“The best case scenario on the recent move up in inflation is that it is temporary, as the recovering economy struggles to get production, operations, supply chains and employees back to something close to normal,” says Keating, chief economist with the advocacy group Small Business & Entrepreneurship Council.

Costs that are most likely to come down are energy-related, as the price of gasoline and other fuels tends to fluctuate. And if supply chain bottlenecks ease, shippers are likely to lower their rates.

But, Keating says, “the second scenario is that inflation takes hold, and as the old saying goes, once the inflation genie is let out of the bottle, it’s not easy to get back in.”

Luongo has found that just about everything that goes into making and shipping an air conditioner or heating unit costs more.

“Copper prices gone through the roof — there’s copper in every air conditioning product and lots of it,” he says. And Luongo’s suppliers are paying more for shipping containers that are in high demand; one manufacturer told Luongo that it only finds out how much it has to pay for a container on the day the ship carrying its products sets sail.

Total Home Supply is more likely to pass along an increase to a general contractor building homes than to consumers who can go to chain stores for air conditioners. “We very carefully weigh pricing decisions for each item and do our best to stay competitive while trying to maintain a profit margin we can live on,” Luongo says.

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