INCREASE IN COSTS
GOODS FROM OVERSEAS SHORTAGE OF EXCHANGE An indication of the manner in which the cost of goods is being direct, ly increased through the operation of exchange control is contained in an invoice which has been received by a Gisborne business man. The total cost of the goods is increased by 5 per cent to meet "London charges covering accommodation front the date of shipment to the approximate date of payment by the Reserve Bank.” The trader in question lias the funds available for the payment of Ihc goods, but because the Reserve Bank is unable to transmit them to London lie has to pay a surcharge of 5 per cent, and this, of course, has to be passed on to the public.
There is also a possibility of a further addition to the cost, as it is intimated that the “price is subject to adjustment if there is any alteration in the rate of exchange when the funds are remitted overseas.” The trader, therefore, has a contingent liability of an incalculable amount and if lie bases his selling price on that of the invoice he might find that his profit is wiped out by a subsequent increase in the rate of exchange.
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https://paperspast.natlib.govt.nz/newspapers/GISH19391106.2.36
Bibliographic details
Gisborne Herald, Volume LXVI, Issue 20087, 6 November 1939, Page 6
Word Count
206INCREASE IN COSTS Gisborne Herald, Volume LXVI, Issue 20087, 6 November 1939, Page 6
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