June 27, 2008 - Cott UK today announced that they have notified their customers of an increase in cost prices by an average 6.5% to take effect from September 1st 2008 in order to help mitigate significant packaging and input costs.
As a high volume low margin business, providing high quality beverages at low prices, Cott is heavily impacted by the exceptional environment in which we are operating today with oil, fuel and transport costs at record highs in addition to energy, aluminium, paper, corrugated, pet resin and key ingredients also rising beyond expectations.
Cott explained that it has delayed this action through having taken significant measures to meet the challenge internally and having significantly cut costs through numerous projects including packaging reductions, waste recycling, commodity tenders and forward buying. These initiatives and further cost reductions just announced, along with additional plans in development, have enabled Cott to limit the scale of the price increase requested from their customers to 6.5% at a time when the factory gate price index is at a record level of 8.9% for the rolling 12 months through May 2008.