Higher Procurement Prices and Demand Weakness from Passing Through Costs
First written in FY2022. 4 of 11 entries say "Restated". Latest entry: 2026-08-10.
The whole theme swung hardest in 2022: 121 of 167 companies on the "Worse" side.
- 2026-08-10MaterialisedEarnings
「Due to the situation in the Middle East, there was a trend toward purchasing petroleum-derived products ahead of schedule to secure inventory, along with a tendency for procurement prices to rise.」
Higher procurement prices for petroleum-derived products and efforts to secure inventory continued due to the situation in the Middle East, resulting in temporary increases in sales at some customers followed by a reactionary decline. - FY2026-H1MaterialisedAnnual report
「The Middle East situation restricted orders from some suppliers of petroleum-derived products and raised procurement prices, while customers also moved to secure inventory. This resulted in temporary sales increases for some customers followed by a decline as the effect reversed.」
Supplier order restrictions and higher procurement prices for petroleum-derived products actually occurred amid Middle East tensions. Inventory building produced temporary sales increases followed by a reversal, demonstrating a tangible business impact from procurement and supply constraints. - FY2025MitigatedAnnual report
「To avoid these risks, our Group is securing multiple procurement routes so that products can be supplied stably at appropriate prices even in an emergency.」
The risk of weaker demand from price pass-through remains, but the 2025 assessment rated both likelihood and impact as low and added multiple procurement routes as a response. - FY2024RestatedAnnual report
「When the products we sell are affected by changes in procurement prices or market and environmental conditions, we protect profit by promptly passing those increases through to selling prices. However, if selling prices rise so much for various reasons that they discourage customers from purchasing, demand could decline and affect our Group’s operating results and financial position.」
The policy of passing through higher procurement prices and the risk of demand declining because of higher prices were reaffirmed. - FY2023-Q3RestatedAnnual report
「Import inflation caused by the stronger dollar continued, and prices for services provided to domestic companies continued to rise, making the economic outlook difficult to predict.」
The continuation of dollar-driven import inflation and higher business-service prices reaffirmed the risk of rising procurement prices and weaker demand following price pass-through. - FY2023-Q2RestatedAnnual report
「Import inflation caused by the stronger dollar continued, and prices for services provided to domestic companies continued to rise, making the economic outlook difficult to predict.」
Continued dollar-driven import inflation and higher business-service prices reaffirmed the risk of rising procurement prices and weaker demand following price pass-through. - FY2023-Q1RestatedAnnual report
「Resource-price inflation caused by the war in Ukraine and import inflation caused by the stronger dollar continued. Although the semiconductor shortage was easing, the outlook remained uncertain because surplus and shortage conditions coexisted across semiconductor products.」
The external environment of elevated resource prices and dollar-driven import inflation continued, reaffirming the existing risk of higher procurement prices, cost pass-through and weaker demand. - FY2022First statedAnnual report
「When the products we sell are affected by changes in procurement prices or market and environmental conditions, we protect profit by promptly passing those increases through to selling prices.」
The basic response is to pass through price increases, but the Group recognizes that higher selling prices could dampen purchasing appetite and reduce demand.