Malaysia’s Inflation Rate On The Rise: How Can Your Small Business Cope?
Did you know that as of January 2022, Malaysia’s inflation rate increased by 2.3% compared to the previous year?
Manufacturers and distributors of goods can no longer produce or supply as much as they did pre-pandemic because of:
- Worker shortages
- Lack of key components and raw materials
- High logistics costs
- COVID-19 variants causing lockdowns and strict border controls
This means demand currently outweighs the supply available which causes a rise in general price levels (AKA inflation).
What can you expect?
An increase in the cost of goods!
The surging prices of food items and basic essentials are forcing business owners to hike up food/retail prices just to keep their businesses afloat.
This may eventually lead to:
- Consumers’ basket sizes getting smaller as people are unwilling to spend more
- Loss of customers
- Reduction in profits as revenue drops and operating costs increase
How can your business overcome this?
1. Expand your supplier list
Having a variety of suppliers for your stock orders can help keep you away from shortages even if one of them fall.
You’ll also be able to cope with any unexpected events that could affect your business operations.
2. Monitor your inventory
Get lower-demand items off your shelves/menu!
Use an inventory management system (like StoreHub) to keep track of your best-selling and worst-selling items so you know what to restock and what to drop on your next order.
You can also try limiting your menu to ONLY BESTSELLERS to take full advantage of your ingredients.
3. Stock up early
Place your borders ahead of time to prevent any possible stock delays. You may also want to consider stocking up on best-sellers to avoid stockouts.
Pro Tip: Utilise the ‘minimum stock levels” feature on your inventory management system to alert you when it’s time to reorder!
4. Adjust your pricing
Let’s be real – price adjustments may no longer be an option as the upward trend is likely here to stay.
So when the time is right, be transparent about it and let your customers know what’s going on.
But how do you tell your customers about price increases without making them mad?
Check out our top tips here:
Don’t let inflation get you down!
Prepare ahead to put your business in the best shape possible to tackle this upcoming hurdle.
The easiest way to do so? Get a powerful POS system (like StoreHub) to help streamline your operations so you can save costs in the long run!