Viewpoints

A Cost Of Loving Crisis?

PG asks members of the greeting card community what extent they believe the cost-of-living crisis will impact on the sector? Will it be better placed than other product areas due to its relative low cost and personal, caring nature? What should the Government do to help? Plus, revelations into some personal ‘pick me ups’!

Miles Robinson

co-owner of House of Cards, a group of seven card and gift shops in the Home Counties

“While I don’t believe our sector is immune, being that the cost of a greeting cards is just above a pint of milk/loaf of bread I do feel our industry will weather the current storm OK.”

Consumer price sensitivity: “I think there may well be some of this, price points of gifts will be ever more important, but I don’t think we will see a massive move in the split.”

Mitigating measures: “Certainly an awareness of energy consumption/reduction where possible and looking at the little things that added up cost wise can make a significant difference. We recently carried out a sustainability study throughout every branch and employee, the results have been quite eye-opening and I think will lead to some brilliant time/cost saving measures in due course.” Govt magic wand: “Permanently fix the Business Rates system!” Personal pick you up: “Well it would have to be chorizo, Pedro Ximenez and ?????”

Above: Greeting cards are better and cheaper than sliced bread! Above left: Miles is partial to a drop of Pedro Ximenez. Left: House of Cards’ latest store in Woodley. Below: The cost-of-living v the importance of loving.

Simon Elvin

co-founder of Simon Elvin

“The cost-of-living crisis is bound to have some effect on the greeting card industry, particularly because of the postage increase.”

Consumer price sensitivity:

“Hopefully the majority of people will still send a card, but they may well be more price conscious when buying one. The Covid lockdown and buying locally did help our wholesale distributors, particularly those with a strong online offering, and I believe this will continue as retailers become more aware of the range of product they can buy from leading wholesalers.”

Mitigating measures: “As a business, we continue to look hard at our costs, but with everything going up and the need to pay our staff more to cope with inflation, we will inevitably have to increase our prices, even though we will swallow as much as possible of such prices increases.” Govt magic wand: “If the Government had a magic wand, they could close down Card Factory, ban SOR and give me a crystal ball that could look forward 12 months.”

Personal pick you up: “When the going gets tough, it’s just a case of trying even harder and ignoring all the doom-mongers.”

Above right: Simon Elvin believes that the crisis bodes well for the wholesale sector. Above: Simon is hoping for a crystal ball which would help him see what the next year has in store for us all.

VIEWPOINTS

Mark Callaby

managing director of Ohh Deer

“The greeting card industry constantly proves its resilience and I think that this crisis will be no different in the sense that people will continue to give cards - though maybe we'll see a few more homemade versions and that some lower budget cards will do well.

From a publisher perspective, I think we're all starting to feel the pinch with prices going up and it's becoming increasingly more difficult for everyone just to absorb the costs, so unfortunately, I think prices will continue to rise slightly.”

Consumer price sensitivity: “I think cards are still seen as a low-cost, but highly sentimental way of letting someone know you're thinking of them - so ultimately I think that the UK will continue to produce the best cards in the world and provide the end customer with plenty of choice for the right card.”

Mitigating measures: “We've been tightening our belts over the last few months. I've let a few people go through our entire costs over the last year (this includes software, printers, cleaners etc) to see where we can spend a little less. We also made sure that we could help our team with their increased costs.”

Govt magic wand: “It needs to be a big wand. What I find frustrating is how many companies are reporting record profits and they seem to be the areas that are really driving up the cost of living (utilities and couriers for example) - I'd like to see some regulations here. Our import and export costs have jumped up significantly and this was well before the fuel cost increases due to the war.”

Personal pick you up: “I have a few, but I got really into cycling over lockdown and now that the weather has got better I've started going out again. The power of exercise with some tunes playing in my ears (with special cycling bone conduction headphones) really helps me clear my head and focus.”

Above: Mark Callaby (right) and his partner, in life and business, Jamie Mitchell. Above right: Another of life’s frustrations…the joys of flat pack furniture erection on an Ohh Deer card.

Sara Burford

co-owner of Cinnamon Aitch

“Running a business is a constant stream of challenges, some more significant and longer lasting than others but there are always threats that need to be navigated or addressed. Resilience and adaptability are key.

As a result of the cost-of-living crisis, people are already making changes to their shopping habits, cutting corners, tightening belts, shaving costs from their monthly outgoings and delaying those larger purchases until things feel more stable. This will impact the greeting card industry, but I think as long as there are a range of products to reflect the range of reduced disposable incomes then people will still want to send cards for birthdays, special occasions or just to connect.”

Consumer price sensitivity: “The consumer may not spend as much as they did before on a card, or they may buy a card instead of a gift, but I think the past two years have highlighted the need and desire to connect more than ever, so this will not stop. At Cinnamon Aitch we have just extended two of our card ranges that retail at £2.25 with this in mind. Hopefully, in addition to the modest retail price, the designs will bring joy and positivity without

Above: Cinnamon Aitch has extended two ranges (including this design) with an RRP of £2.25. Left: Sara Burford among trees, her personal pick-her-up.

Fiona Fabien

co-owner of Papyrus, Glasgow

“It would be very naive to think that the greeting card industry would be immune from the cost-of-living crisis. I think most of our customers will be keeping an eye on expenditure and have to think about essentials v luxury. There will always be a market for greeting cards as they are relatively inexpensive compared to a gift, and cost-effective way of marking a special occasion, and are engrained into our British psyche. Thankfully, the price increases so far have been relatively lower than on other consumer goods.”

Mitigating measures: “All businesses will be facing the same pressures of rising fixed costs, from wages and utilities to services, so we will be in for a tough time. Having been through the last recession, we know that we will be keeping a very close eye on business costs and will ride the storm.”

Government magic wand: “I think that our biggest worry will be a general decline in footfall in the high street as consumer confidence falls so I would like to see the Government introduce measures to ease the crisis for the people most affected. The last recession we saw a reduction in VAT, which would be helpful, however I think a targeted approach to help the families and people from lower incomes would be fairer.”

Personal pick me ups: “When times are tough my pick me up is an evening spent with my good friends - this never fails to cheer me up, and problems never seem as bad when shared.”

Left: Fiona believes Papyrus can tap in to the enduring appeal of greeting cards, whatever the economic pressures. Above: Fiona in the shadow of Edinburgh Castle during a showroom experience arranged by agent Lucy Sharp.

focusing on material items that people may have to forego for the present period and beyond

Retailers are a savvy, creative breed who respond to and reflect our times. There are already nods to more price sensitive products and discount schemes popping up on social media.

As long as the design resonates with the consumer, makes that all important emotional connection and the price is right, then we can ride this current storm.”

Mitigating measures: “The cost of production crisis, has seen increased costs in everything from board prices, running a studio and employment costs, delivery charges, on top of the aftershocks of Brexit, high street closures and a global pandemic still leaving financial scars. It has become more and more difficult to absorb the many increasing costs at a time when it has never felt more detrimental to increase them. Throughout the pandemic at Cinnamon Aitch, we streamlined and tightened our running costs to a point where there is nowhere else to trim.”

Government magic wand: “The Government should rethink business rates for independent retailers. This doesn’t even need a magic wand, just some longterm foresight and common sense.”

Personal pick you up: “My personal pick me up is always a walk through the woods. Rain or shine, the trees have it every time for escapism, reflection and rejuvenation. Sarah [Fitzpatrick, coowner of CA] on the other hand finds more relaxation in a large glass of red!!”

Above: It’s a cheers from Cinnamon Aitch’s Sarah Fitzgerald.

VIEWPOINTS

Matt Genower

managing director and co-owner of Five Dollar Shake

“Everybody knows we’re all paying more for just about everything. In the same way eyebrows may be raised that a loaf of bread may cost over £2, the same will invariably occur when a greeting card is turned over. We think certain occasions/captions will be harder hit than others, but do I think consumers will make a beeline for a cheaper wedding, anniversary, baby, special birthday card? ~ absolutely not.”

Consumer price sensitivity: “I know several of our customers have in recent years introduced a small offering of much cheaper cards and these I am quite sure will sell better than ever. However, most of our indie retailers have consumers looking for a specific style of card and I don’t think they will be swayed on price when finding that ‘right’ card.”

Mitigating measures: “We have recently run a couple of initiatives that many of our retailers have tapped into. They will have certainly benefited financially from these. Anything we can do to help them get more feet through the door we will.”

Government magic wand: “For retailers; I’d ask the government to stop dithering on a forthcoming review on how commercial rates are calculated. Do it now! For the rest of the country; recognise how is it possible that that the world’s fifth largest economy has in the 21st century, hundreds of thousands of people choosing between heating or food. Recognise it and solve it…now!”

Personal pick me up: “To spoil our beloved dog Masha; bones, treats, a posh collar or two… she knows nothing of pandemics, conflict, cost of living crisis….oh to have her four-legged life!!”

Above: One of Five Dollar Shake’s completely new Fête de L'amour wedding designs which we will be launched at PG Live in June. Right: Five Dollar’s Matt Genower with his four-legged friend, Masha.

Nicci Gower

co-owner of Hammond Gower

Left: Nicci Gower. Below: Nicci harks back to the words from Leo DiCaprio in Don’t Look Up as inspiration.

“In previous recessions or difficult times there has always been a belief that cards have done well, but we have never been through a period like this in my lifetime, where everything as we know it is shifting and changing at such a fast pace. I try to keep away from the drama of it all and continue to put one foot in front of the other and know, absolutely know, that life takes care of us and does not work against us as much as we sometimes feel it does.” Consumer price sensitivity: “I think the retailer is very conscious of pricing and is nervous about going over a certain threshold so I think pricing is important to them.” Mitigating measures: “We have had huge increases of costs. Our board cost has gone up nearly 15% since last summer along with envelopes and all our various other components but we have made the decision to swallow the cost to help our customers out. They need all the help they can get following on from the last two years of Covid.”

Government magic wand: “To help all our retailers out by drawing the consumers back out into the city and town centres and by making their life as easy as possible.”

Personal pick me up: “When I am worrying or feeling sorry for myself, I remind myself of the brilliant words Leonardo DiCaprio so rightly said in the movie Don’t Look Up… ‘We didn’t realise we had it all’.”