We’ve recently spoken about investing in times where inflation is high, but paying attention to inflation and it’s impact on businesses and the economy is top of mind at HRH Investments. While 2021 started with low inflation, the rate of inflation quickly grew and was at 5.4% in September. The last time our country saw inflation this high was during the 2008 recession.
We see the impacts of this directly as the prices for raw materials and supplies we purchase in bulk for our various businesses have gotten significantly more expensive, a cost we have to pass on to our customers. The speed of inflation and it’s impact on raw materials has also impacted our quoting and contracting process. For custom work, quotes are turned around quickly and are only valid for a short window – the same window that the quotes we get for raw materials are valid. Similarly, in long term contracts, when large amounts of raw material are part of the pricing, the contract indicates exactly how the pricing of parts will vary based on raw material costs at the time of each order.
Employees, who are also consumers, are also starting to feel the pinch of inflation as prices for the various goods they purchase regularly continue to rise. This is one of the factors driving a rise in wages demanded by employees. Our HR team is always looking at ways to attract the best employees, combining pay, benefits, schedules, and more to ensure we can hire and retain the labor we need to serve our customers.
HRH investments is always looking for new business opportunities that compliment our current profile. We are financially strong and able to buy businesses that are the right long-term investments for our profile. We look in the manufacturing and consumer services areas, but are open to any business with EBIDTA between $1 and $6 million that are cash flow positive.