“Brexit blaming” won’t help
Management Today Microsoft has become the latest company to jack up prices, citing the increased currency costs since the Brexit vote, says Jack Torrance. Sensibly, perhaps, it is targeting the planned 22% hike in “services” at commercial customers, “who will find it harder to switch to another provider”, rather than consumers. In economic terms, the move seems entirely justifiable – the pound has fallen 20% since June and shows no signs of recovery. It is probably fair to suggest that were sterling to rebound to $1.50, “Microsoft wouldn’t be in any hurry to slash prices”. But we may never know, as the more likely scenario is that the low exchange rate becomes “the new normal” – and that many other businesses find they have little choice but to increase their prices, or reduce headcounts. Even so, they should be careful: if they’re perceived to be “using Brexit as an excuse”, they risk suffering long-term reputational damage. Companies that “take the mick” by “blaming all of their ills on the referendum result” will receive short shrift from a sceptical public. Trust in UK plc is “already shaky”. Executives should be careful not to make it worse.