Learn how inflation and exchange rate movements affect your company. This also depends on how often your business changes prices, negotiates prices, and how expensive it is to change prices.

Question: Learn how inflation and exchange rate movements affect your company. This also depends on how often your business changes prices, negotiates prices, and how expensive it is to change prices.

Answer: Inflation and the exchange rate movement affect my company, which is a private school, in the following ways:

If inflation rises or our national currency weakens, the cost of running the school, infrastructure, and various services will increase. This will lead to a decrease in the net income of a private school. Hence, to meet this usual school, the monthly fee is increased.

Changing fees or making a one-time payment is also expensive because the notice must be posted to all interested parties, and the same change must also be listed on the school's official website.

Inflation changes very frequently, but at the same rate, school fees cannot be changed, so the school should anticipate how much fees will need to be increased so that the review can take place 6 months or a year later.

Regarding the fee increase, there is a ceiling that is set by country and what is more that cannot be increased after taking the fees indirectly, such as project fees, fees for organizing extracurricular activities, etc.

Inflation rates in any country can have a significant impact on the value of a country's currency and its exchange rates with other currencies. But inflation is only one factor affecting the country's exchange rate. By manipulating interest rates, central banks influence both inflation and exchange rates, and changes in interest rates affect inflation and the value of currencies. Higher interest rates give lenders in the economy higher returns than in other countries. The impact of exchange rate fluctuations on the company. Exchange rates are affected by changes in currency and its value. When your currency appreciates, it means it will be worth more than the foreign currency you want to exchange. Inflation can have a significant negative impact on the value and exchange rate of currencies. Very low inflation does not guarantee a country's favorable exchange rate.


Until then, setting prices for new products and even current production lines was more than pure mathematics. In fact, this may be a direct step in the process. This is because numbers work logically. People, on the other hand, yes, we can be much more complicated. Changes in product composition affect sales and profitability, although product pricing has not changed. This also applies to profit margins and costs. For example, the milk price war in Australian supermarkets has led to an increase in unit size, but has had two serious impacts on manufacturing profitability.