As costs bite, CEOs ready price hikes
MANILA -Some 42 percent of the country’s top chief executives who participated in a recent top-level survey said they plan to raise the prices of their products and services in the next 12 months, signaling what could very well be a more expensive holiday season for Filipinos.
The joint Philippine CEO Survey 2023 of professional services firm PricewaterhouseCoopers (PwC) and the influential Management Association of the Philippines (MAP) was conducted last July and August and covered 157 Chief Executive Officers (CEOs)
The surveyed business leaders said a price increase was one of the six measures that they plan to undertake to cope with potential economic challenges and volatility over the next year.
In the same survey, 30 percent of the respondents said they were already in the process of implementing price hikes.
“My expectation is that (prices of) consumer goods, in general, will go up,” PWC Philippines chairman Roderic M. Danao said during a press conference when asked what goods would likely see an increase in their price tags, highlighting in particular those with grain components.
Danao said they attributed the looming price adjustments to the need to cope with inflation caused by factors such as Russia’s withdrawal from a global grain deal, as well as its decision along with Saudi Arabia to cut oil production this year.
But despite this high probability of price increases, the PWC executive said he believed that most companies would still keep their prices “competitive” so there is some semblance of balance in the market.
Inflation in the Philippines as of July was pegged at 4.7 percent, slowing for the sixth straight month but still averaged at 6.8 percent since January, according to the Philippine Statistics Authority.
Despite plans to raise their prices and the threat of inflation staying elevated for some time, 79 percent of CEOs in the survey said they remain positive that their companies will experience revenue growth in the next 12 months.
In particular, 39 percent cited they were “very confident,” while 40 percent said they were “somewhat confident.”
Still, this reflects a moderate downgrade from last year, when 43 percent and 44 percent noted the same sentiments, respectively.
Aside from this, 83 percent of surveyed CEOs also reported that their companies had already rebounded from the pandemic, in track with what nearly half of them had projected that a recovery will be achieved in two years.
Last year, 63 percent of respondents said that they had rebounded from the dire economic effects of the global health crisis. INQ