At the end of the day it comes down to: trust. The value of a currency is going up and down in comparison to other currencies based on a web of trust and buy/sell decisions in a market that is gigantic and larger than the real world due to speculation. A while ago, like 2-3 years, the EURO was worth 1.6 Francs. Now it is 1.25. This means: If you live in EURO land, you pay now about 20% more for the same products coming from Switzerland. A number for the Dollar US: Since 2001 it lost half its value against the Swiss Francs. There, too: things are bad, as the Dollar US is in uncharted territory and heads further down.
Well, I guess Ms. Helvetia is a tough lady these days. Consequences for me are: I am partly reducing my margin, have to see raised prices in local currencies without me doing anything, and am confronted with questions such as: Sourcing more in EURO land and/or US land. As sourcing raw materials or other products is a long term decision, I am very careful in changing suppliers. Sourcing in US land is difficult though due to long distances.
Furthermore, here is another piece of information to worry about. I see that my Swiss suppliers do not raise prices, in the contrary. But I see my European suppliers raise their prices by 5-10%. Which makes you go WOW! Euro land is heading for higher prices and it makes all sense. Everything from outside of EURO land, like oil, or metals or food, is getting more expensive.
But then: I do not worry deeply. I met a nice guy the other day who is about to finish his education as perfumer, and he told me that I offer my products far too cheap. I guess it is all about trust.
Today’s picture: A detail from a scanned 1 Franc piece.