Next to Raise International Prices Up to 8% After £47m War‑Driven Cost Surge

*TL;DR: Next will increase prices in non‑European markets by up to 8% to cover a £47 million cost rise linked to the Middle East war, and it has lifted its full‑year profit forecast to £1.22 billion.

Context The fashion and homeware retailer Next faces higher fuel bills and supply‑chain disruptions after the US‑Israel conflict with Iran closed the Strait of Hormuz, a key oil shipping lane. The closure has pushed global fuel prices sharply higher, adding pressure to retailers that rely on imported goods.

Key Facts - Next expects an additional £47 million in expenses this year from higher fuel costs and supply‑chain interruptions tied to the Middle East war. The figure far exceeds the £15 million the company originally projected for the first three months of the conflict. - To protect margins, Next will apply price hikes of no more than 8% in any overseas market, starting in May. The company stresses that European and UK prices will remain largely unchanged, with the UK price rise capped at the 0.6% forecast earlier in the year. - Full‑price sales grew 6.2% in the first quarter, driving a modest upgrade to the profit outlook: the full‑year forecast now stands at £1.22 billion, up from £1.21 billion. UK sales rose 4.4%, beating expectations. - The retailer attributes the ability to limit UK price moves to cost‑saving measures and better factory‑gate pricing, while currency gains in Europe have offset local cost pressures. - International sales dipped when the conflict began but have shown a “significant recovery” in recent weeks, though growth remains slower than the early‑year pace.

What It Means Next’s decision to cap overseas price increases at 8% signals a calibrated response to volatile input costs without alienating price‑sensitive shoppers. The £47 million cost burden illustrates how geopolitical shocks quickly translate into retail expense lines, especially for firms with global supply chains.

The modest profit forecast lift suggests that Next’s cost‑control tactics and strong first‑quarter sales are cushioning the impact. However, the company’s share price is down 5% year‑to‑date, indicating investor caution.

Looking ahead, the retailer’s performance will hinge on the duration of the Middle East shipping disruption and the trajectory of fuel prices. Monitoring fuel cost trends and any further supply‑chain bottlenecks will be key to assessing whether Next will need to extend price adjustments beyond the current 8% ceiling.