A Different Approach To A Price Increase
We have recieved yet another price increase notification, this one particularly important, since it comes from our primary converter for gaffers tape.
Pro Tapes & Specialties, is taking a different approach. They have chosen to decrease the length of a roll of gaffers tape from 60 yards, the standard for many years, to a new standard length of 55 yards. This is, essentially, a 9% increase, even though the price for a roll of gaffers tape will remain unchanged.
We had recently advocated for this approach as a way to address pricing pressures, but certainly did not expect to see it implemented so soon.
If you have been following the futures pricing of commodity futures for the primary components in a roll of gaffers tape, you know that these prices are trending down, and in the case of cotton (the most expensive component in a roll of cloth tape), the price is down significantly.
As in all the other price increase letters we have seen recently, major manufacturers continue to make the argument for price changes based on raw materials. If this is true, then pricing should be stable at worst and over the next couple of quarters, prices should start to move down.
If the tape industry widely adopts the new 55 yard roll standard, it will be even harder to track if pricing is truly moving in the right direction, based on the raw material argument.
Please check back here often for updates on how this is playing out.
Link to Pro Tapes & Specialties price increase letter.
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