Spandex customers have until the end of the month to get in on the old prices as the supplier follows most of the industry in adjusting prices.
According to Alex McClelland, managing director, (pictured) the deterioration in the currency is the main driver behind the price rises. “We’ve held on for as long as possible but there is no sign of the Australian dollar climbing back to over 90 US cents in the short term, or anywhere near the parity it enjoyed against the greenback in 2012-13. With the majority of our imports paid for in US dollars; this obviously affects the landed costs. However, for products we pay for in Euros, we will actually be able to reduce some prices, so it is not all bad news,” says McClelland.
In a press release the company linked the price rises to world currency markets, which it says, are in a volatile state, with the Swiss Franc being de-linked from the Euro in January, causing wild fluctuations and economists predicting a bull run for the US dollar in the foreseeable future as oil prices remain low. The Governor of the Reserve Bank, Glenn Stevens has openly advocated a ‘desirable’ exchange rate against the US dollar of 75 cents – 25% lower than one year ago. Lower demand for raw commodities from China is another significant factor. Compounding the issue is the fact that many manufacturers have passed on increases due to raw material and manufacturing costs which were absorbed when the exchange rate was favorable.
“Virtually all materials used in the signage and display industry are imported,” says McClelland. “As the largest supplier, we do endeavor to protect both ourselves and our customers from frequent price changes but we are now undeniably affected by world currency movements. Several paper and media merchants and our competitors have already adjusted prices; Spandex’s new pricing will come into effect from March 1st so there is time for our customers to stock up if they wish to.”