Minimum wage increase has ‘ripple effect’ on prices, London business sayspublished at 06:31 GMT
Adam Woods
Senior business and economics reporter
Jenny Holloway is the chief executive of Fashion Enter, a garment manufacturer in London.
Jenny says that increases in the minimum wage have put a squeeze on her business. When the minimum wage goes up, there is a “ripple effect” whereby the wages of senior staff must go up in turn, she says.
Some of those costs are then passed on to the consumer.
Electricity is another consideration, she says, and the factory is keeping its power usage as tight as possible in an effort to keep bills down.
“It’s constantly making sure that we’re turning the lights off regularly. We’ve got all LED lighting now, for example. We’re on timers so the lights will go off,” Jenny says.
There are also some unexpected upsides to higher costs. While material costs have gone up by around 20%, the prices are higher for imported fabrics than for local ones.
“We’re finding Leicester far more competitive, and so from a perspective of carbon emissions and sustainability we’d rather go local.”
