Inflation continues in France, and according to a study, the margins made by companies would also play a role in the increase in prices. But if they started to rise again at the end of 2022, to 18% on average, the margins are still lower than those achieved in the past.
Inflation remains one of the major concerns of the French. It is boosted by the cost of raw materials, but not only. The margins of companies are also in question, according to a study. Contained for a time, they started to rise again, enough to contribute to inflation in 2022.
Lower margins than in the past
At the end of last year, companies rebuilt part of their margins, weighed down by the energy crisis, which explains a good part of the rise in prices during this period. But their margins remain lower than they have been in the past: 18% on average in the commercial sector.
“This is one point less than what we had on average from 2010 to 2019”, points out Denis Ferrand, director general of the Rexecode institute.
Limit the impact of rising prices
On the other hand, over the rest of the year, companies tried to limit the impact of the rise in energy and raw material prices so as not to increase selling prices too much or lose customers. “At first, when all costs were increasing, companies tended rather not to pass on the entirety of this cost shock and, in doing so, by reducing the margins they made. And that is is really the observation on the average of last year”, adds Denis Ferrand.
And it seems to have worked. The Banque de France has lowered its inflation forecast for 2023 to 5.4%.
I am a journalist who writes about economics and business. I have worked in the news industry for over 5 years, most recently as an author at Global Happenings. My work has focused on covering the economy news, and I have written extensively on topics such as unemployment rates, housing prices, and the financial crisis. I am also an avid reader and have been known to write about books that interest me.