Will January's VAT rise impact on your business?

HW asked exhibitors at the Southern Growers Show how they are likely to be affected by the new year's increase.

"It's going to be very interesting because I suppose in an ideal world the retailers would like the growers to absorb it but with costings being as tight as they are, that's a wish. So the alternative is that retailers put their prices up, but if you were on £2.99 for bedding do you go to £3.09 to cover the VAT? I don't know. I think it's up to the retailers.

"For us it's a fairly small impact - the only thing we charge VAT on is flower seeds and 17.5 to 20 per cent on a lower value item will make no difference at all to us."

- Ian Riggs, business development manager, Kings Seeds and chairman, British Protected Ornamentals Association

"Probably not because we are further down the chain - we get it added on from our suppliers and it goes on to our customers. The difference goes to the VAT man so it's not a big issue for us. It's just an extra percentage that we have got to recover from the clients and add on to them.

"Where it's a retailer or end user, I can understand that they have a problem. But just as our suppliers put the VAT increase on, we will do the same."

- Jeremy Watkinson, managing director, PPC Labels

"On our wholesale products it will have no effect because we are selling business-to-business. The only effect it makes is in the costings. It has affected garden centre products that we sell from July onwards, and a lot of the garden centres have already incorporated this.

"We do have customers who will give us new retail prices from 1 January, but a lot of people have put on extra prices for the season. When the rise hits in January, they have a bonus and then they will change in the summer."

- Steven Lee, sales director, New Place Nurseries

"I think there's some talk of certain bigger companies asking their suppliers for discounts to offset the VAT increase but most people cannot do that. It makes it harder for us because we are still working in an environment with a downward price pressure.

"We have kept our bulk catalogue prices the same for the last three years but obviously the price that our wholesale suppliers are paying is going up, but not going anywhere for us. Basically I don't think it's going to affect us too badly."

- Neil Alcock, managing director, Seiont Nursery.


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