Countless CEOs reported struggles to keep up with the cost of their raw materials and labor last year, kicking off a rush to increase prices of their own goods to keep pace—and preserve margins. But even with demand—and inflation—cooling a bit, the vast majority of CEOs plan to continue raising prices in the months to come.
Actually, according to a Chief Executive survey of 333 CEOs in January, more CEOs now say they plan to increase prices versus when we last asked the question in July 2022. Some 6.6 percent more CEOs have risen or are considering rising prices—to any extent—now compared to six months ago.
But even if the number of CEOs planning price increases continues to grow, the rate of increase appears to be slowing. For example, in July 2022, only 21 percent of CEOs reported increasing prices/considering rising prices up to 4.9 percent, while 37 percent reported price increases of 7.5 percent or more.
Skip ahead six months, and the figures flip—only 20 percent of CEOs say they are increasing prices by 7.5 percent or more, while 39 percent report price increases of 4.9 percent and below.
Price Changes by Size and Industry
According to our poll, CEOs in companies with revenues of $50 to $99.9 million are the least likely to increase prices, where only 71 percent have increased or are considering growing prices to any extent. All CEOs polled from companies with $1 billion or more in annual revenues said they have increased or are planning to increase prices.
The data shows that small companies, with under $10 million in revenues, are the most likely to enact or consider substantial price increases. One-third of CEOs from small companies report raising prices or considering a price increase of at least 7.5 percent compared to only 14 percent of CEOs from small to mid-size companies, those with $25 to $49.9 million in revenues, who said the same.
Examining the data by industry reveals that the high tech/information technology industry has the highest proportion of CEOs who say they have increased their prices or are considering increasing their prices by 7.5 percent or more, at 30 percent. Consumer manufacturing has the lowest proportion of CEOs considering or have increased their prices by 7.5 percent or more at only 8 percent.
The industry with the highest proportion of CEOs who say they will not increase prices but instead maintain prices or decrease them is retail trade, at 31 percent.
About the CEO Confidence Index
the CEO Confidence Index is America’s largest monthly survey of chief executives. Each month, Chief Executive surveys CEOs across America, at organizations of all types and sizes, to compile our CEO Confidence Index data. The Index tracks confidence in current and future business environments, based on CEOs’ observations of various economic and business components. For additional information about the Index and prior months’ data, click here.