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“When fuel price become high, then price of essential products suddenly leaps into high”. What are the reasons behind this situation?

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Question added by Fazlul Hoque , Assistant Director , DoF,GoB
Date Posted: 2013/09/11
Fazlul Hoque
by Fazlul Hoque , Assistant Director , DoF,GoB

All essential products are carried into markets by different types of transport vehicles which are mosty dependent on fuel.Major of the products are producing in the factory where fuel or electricity is highly needed.Electricity is producing mainly on fuel.So when fuel price become high, the essential products price become high.Because human being can not live anymore without their essential products.Thus supply of products declined and price inclined.

Amr Kilany
by Amr Kilany , Senior Digital Media Specialist , Brand Worx

This is a supply chain problem, and can be solved in some cases by using  some techniques like economy of scale.  and the reason simply because the client pay every cent costed by the manufactureing company plus a profit share. so if the product costs1 Dollar to be manufactured and0.5 Doller to be shipped to the customer, the total cost is1.5 Dollar. if we added10% profit so the price is1.65 Dollar lets suppose that the fuel price went up and the cost of shipping will be1 Dollar so the cost will be2 Dollar and the price will be2.2 Dollar

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