Shop Direct
LIVERPOOL-BASED home shopping group Shop Direct is to move some of its production nearer home as the cost benefits of Far East manufacturing continues to diminish.
Rising labour costs, along with increases in energy and freight, have hit the cheap operational costs that have attracted Western companies to China and India in the last decade. Analysts expect the rises to be part of a long-term upwards trend.
Mark Newton-Jones, chief executive of Shop Direct, said: “We’ve seen a decade of price deflation on the high street. But what we are now seeing is the return of inflation.
“It will not be long before parts of Europe are as competitive as China for manufacturing, if costs continue to rise.”
Shop Direct expects to treble production in Europe and the Near East to 30% next year, with Turkey the main beneficiary.
The group, which includes brands such as Very.co.uk, Woolworths.co.uk and Littlewoods Europe, has annual sales of £1.7bn.
