Navigating Currency Crises: How Knotwidth Textiles Manages Yarn Prices

One of the key aspects of how we operate at Knotwidth Textiles is our weighted average cost basis for pricing. Instead of reacting to short-term changes in market prices, we focus on long-term cost management. This means that we:

• Buy smart and sell competitively: We work hard to source yarn at the best possible prices, which allows us to offer competitive pricing to our clients.
• Run an efficient operation: By maintaining modest gross margins, we can keep our pricing stable while covering our costs and continuing to operate efficiently.

Unlike many businesses that adjust their prices immediately when upstream costs increase (think of how gas stations adjust to fluctuating oil prices), we take a more measured approach. Our goal is to keep prices as stable as possible for as long as possible.

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During times of significant economic shifts, such as a currency crisis, price increases can become inevitable. For example, in recent years, the Canadian dollar has experienced sharp declines, which directly affects the cost of imported yarns. As the Canadian dollar fell by 15% over just two months, we faced the reality that replacement costs for many yarns would be significantly higher.

However, at Knotwidth Textiles, we approach this challenge thoughtfully:

• Price stability: We aim to hold prices on our current inventory for as long as possible. Because we have an expanded, paid-for inventory, we can absorb some of the cost fluctuations in the short term.
• Selective increases: When we do need to raise prices, we ensure that these increases are absolutely essential. We communicate clearly with our clients to avoid confusion or unexpected costs.
• Inventory advantage: Many of our current imports, priced in U.S. dollars, may not see the same dramatic price increases due to the decreased costs of commodities in global markets.

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Given the current economic climate and the fluctuations in currency values, we recommend that our clients take advantage of our existing inventory, which is priced competitively. Here’s how you can stay ahead of the curve:

1. Stock up now: Purchasing yarns from our current inventory before they are replaced by higher-cost goods can help you maintain consistent costs in your production.
2. Consider buying in U.S. dollars: By making purchases in U.S. dollars, you can potentially avoid further price increases as the Canadian dollar fluctuates.

We have a larger-than-usual inventory available, but please note that it is subject to prior sale and availability. We encourage you to contact us to consult on stock levels or to make a new booking.

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With over 35 years in the yarn industry, Knotwidth Textiles has proven its ability to navigate challenging economic conditions. Our experience has taught us to be agile, adaptable, and proactive in the face of adversity. We pride ourselves on being a knowledgeable and reliable supplier, even during uncertain times.

At Knotwidth, we are committed to working harder than ever to earn your trust and confidence. Our goal is to provide exceptional service, transparent pricing, and reliable product availability, regardless of market conditions.

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If you have any questions about current pricing or availability, or if you’d like to discuss purchasing options, please feel free to contact us. We’re here to help you navigate these “interesting times” and continue to provide the yarn products you need to keep your business running smoothly.

Knotwidth Textiles: A trusted partner in the yarn business, offering stability, transparency, and reliable service during economic uncertainty. Contact us today to learn more about how we can support your business with competitive pricing and a wide range of quality yarns.