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McArthur’s Bakery Owner Dave McArthur on the impact of rising inflation on his business’ costs.
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My next guest thinks those January numbers are happening -- I gotta tell yet he's a baker.
So he should now.
Because if you ask Dave Arthur the inflation proof is in the -- keep putting -- welcome thanks so much for joining us thank you for sure that.
So the price of your ingredients going up going down staying the same what do you -- Well right now there where we've gone up though the -- been over the last twelve -- -- sixteen months we've seen an escalation of thirteen to 14% just on raw ingredient.
And they haven't nothing's tapered off and for the first time in our history of 55 years there was not any one single thing that went up.
Everything went up very went up oil went up shorter went up flower -- -- and -- right now.
-- -- the United States is part is paying one of the highest prices in the world for shorter.
For no reason at all except that we're you know our politicians -- the fact that we still wanna.
Support to shorter industry and we're paying on average 35 have more than our Canadian neighbors you know discouraging us.
A lot of points there to get -- But first of -- are you able to pass those prices along to your consumer -- -- those costs.
-- half you have to pass -- on you can't -- that our our typical net margins and our business.
The size of art and -- across the industry -- we are net goal is one and a half to 2%.
Net profit.
So when you're talking about thirteen to 15% just raw -- -- -- ingredient cost.
There's no way that you do absorb that you have to pass that yeah when we add what energy is done diesel fuel and petroleum our electric bill are natural gas bill.
Last year we raised our prices 18%.
Just to keep the doors open.
Wow did how do you feel when you hear Ben Bernanke and other economists say there's no inflation -- that's not a problem how does that make you feel.
What are it would actually like to ride home with them -- afternoon and his -- CNN driving by a gas station.
Watch him get out the door and realize what it's like to put a novel into the thing.
And then look at your wall -- -- -- joy I have about forty bucks in your wallet full ownership for the next two weeks mr.
Bernanke.
Would you please come join the real world.
-- yard field your menu here up you say Canada recruiting you what you mean by.
Well that what they're doing is they're recruiting our our industrial -- manufactures in this country to come up north produce the product.
Because they're sugar prices are 35% cheaper than ours so we can literally.
A big company like a Keebler Sarah leave very concerned they're baked good.
Contract north of the border haven't produced ship it back to the United States.
Cheaper the American manufactured here because of the grain costs because we're subsidizing the CBO said years ago.
This cut that sugar subsidy yeah and no -- in congress Democrat or Republican.
Pays a bit of attention art in our guess someone -- gonna lose -- -- they're you know yeah third day at the golf course with their body or something.
I -- you battling at the price of sugar is ethanol to blame for that you think it's well.
It stands in their yes because there and at what happens there's -- sugar price drops ethanol drops down.
-- our government has guaranteed or ethanol producers that they will then pay them the upside.
Well then what happens is when sugar sorry it's like when gold -- oversight when gold side copper chart.
What would -- tie it all artificially inflate the price of everything else will follow along with that yeah because they can't.
Did you -- -- November.
Right now I don't have a clue my I don't see you know aren't -- tired of people talk about the birth control pill.
And then all this other stuff that and then not dealing with the real issues and that's fuel and food.
This economy will not recover until the middle class has an extra twenty to forty -- to weaken their wallets to think about going and buying a new car.
Going to the registrar.
-- -- and into -- house I mean these people don't have a clue what stifle in this economy it's not just unemployment.
It's the people that are employed.
Don't have the money coming in to make this the changes -- -- -- put money back into the economy that's it.
Did the baker you have my vote for president thank you so much for continental united.
We refused saying we should have had a great week.
