UK-based fashion retailer Next has said that it could make its customers foot the bill for higher wages following the introduction of the National Living Wage, but price rises would be just 1% over four years.
Next expects 6 per cent rise in prices to fund additional wages costs between 2016 and 2020; 1 per cent would come from the cost of covering the National Living Wage and its knock-on effects on other staff wages. The remaining 5 per cent would come from general wage inflation, estimated at 4.5 per cent a year.
Next will have to pay its staff more from April
The retailer noticed a 7.1 per cent rise in pre-tax profits for the first half of the year to £ 347.1 million, up from £ 324.2 million a year earlier. Next’s adult starter hourly rate is currently £ 6.70, meaning that the cost of implementing the living wage would be £ 2 million for next year but could rise to a total of £ 27 million a year.
