CIPS warns food, technology and freight costs could double over Christmas

Businesses and consumers could be hit hard in the run up to Christmas 2026 as continued supply-chain disruption will see double-digit price rises hitting transport, household staples, food and technology products.

The latest CIPS Global Pulse Survey for Q3 2026 shows what earlier surveys warned that higher freight and input costs would feed through to businesses and households. Respondents describe production costs becoming “difficult to reconcile with the prices customers are willing to pay”, while expectations of further increases extend across the full range of input categories. Continued disruption, fluctuating fuel prices and instability along key global trade routes are compounding manufacturing costs and the expense of moving goods worldwide.

Almost one in four respondents indicated that food and beverages (23%) would see prices rise by at least 10% in the coming quarter, alongside 26% for computers and peripheral equipment and 36% for shipping and logistics. Including more moderate increases, 42% expect food and beverage costs to rise by at least 5%, rising to 51% for computers.

When given the opportunity to list specific goods of concern, respondents identified beef, seafood, dairy products, coffee, rice and vegetables among the foods most exposed to input price pressures. One reported that fresh vegetable prices are already up by more than 10%; another suggested prawns are impacted to similar levels, while plastic and paper packaging are up 5–10%. Technology buyers also report component shortages, with one highlighting a “Shortage of chips has repercussions for laptop purchases”.

These pressures are compounded by expectations of increases of at least 10% in chemicals (29%), refined petroleum products (27%) and rubber and plastics (24%), adding to manufacturing, packaging and delivery costs. CIPS warns that pressure on diesel supplies, continuing conflict in the Middle East and Ukraine, and disruption to shipping routes serving the Suez Canal are compounding that exposure. Higher transport costs are being layered onto the cost of energy, raw materials, packaging and components needed to produce the next generation of stock.

Dr John Glen continues:

“Diesel is particularly important because its cost runs through freight, distribution and parts of the production process. When fuel, materials and logistics all become more expensive, a manufacturer cannot solve the problem simply by finding a cheaper delivery route.”

“The squeeze becomes unsustainable when the price customers will accept no longer covers the cost of producing the goods. Businesses then face difficult choices about margins, selling prices and whether production remains viable. The risk is a steady accumulation of price increases and supply disruption through Christmas and into the New Year, with food and manufactured goods particularly exposed.”

That pressure is already evident in respondents’ accounts. One said: “The cost of manufacturing is becoming too high for the end product price point; suppliers are struggling to meet the cost expectations.”

Food supply concerns show how weather, availability of fertilizer and commercial pressure can combine. One respondent reported: “Weather conditions are pushing up the prices and supply quality of vegetables. Rice will be affected by El Nino. Middle East disruption has severely impacted the price and availability of plastics. Prices are rising and retailers do not want to accept the on-costs, putting huge pressure on manufacturers.”

The account illustrates the risk of food becoming more expensive to produce and package while suppliers struggle to recover their costs. It also points to potential shortages of products as availability and quality fluctuate. The survey does not predict the scale of shortages or a uniform increase in retail prices, but it provides a warning of pressures that could narrow choice and raise household shopping bills.

Technology purchasing is also exposed; another respondent highlighted a “Shortage of chips has repercussions for laptop and mobile phone purchases.” Such component constraints create a risk of longer lead times and higher hardware costs for businesses and consumers as seasonal demand builds.

Ben Farrell continues: 

“Our members are describing the point at which supply chain disruption starts to undermine the economics of making and selling everyday goods. A supplier that cannot cover its production costs is a risk to every business relying on it, however competitive the original contract appeared.

“Boards need to act on what procurement teams are seeing now. That means understanding where critical materials come from, checking the financial health and capacity of suppliers, and securing alternatives before a shortage becomes a missed delivery. Squeezing an already stretched supplier harder can put continuity of supply at greater risk.

“There is still scope to reduce the impact on customers. Procurement and supply professionals need the authority to work across the business, plan realistically and agree sustainable arrangements with suppliers. Waiting until stock fails to arrive or a contract becomes uneconomic will leave organisations with fewer options and consumers facing the consequences.”