Effects of Inflation on Business 

When we think of inflation we usually think of how it affects us as consumers. But the effects of inflation are wide ranging, including not only individuals but also businesses and even countries. 

When prices are rising too quickly, the resulting confusion can lead to lower investment due to uncertainty about future costs and profits. Poor economic policies can spark or exacerbate inflation, as can a weakening currency.

Here are some factors which could affect inflation on businesses

Consumer Purchasing - Rapidly increasing prices will lead consumer to stay away in droves. 

Inventory cost- Rapidly rising prices will affect the cost of businesses have to pay for materials and inventory.

Price changes - This could also result in businesses to keep printing new menus or changing price tags to list the correct price due to the fluctuation of service and product prices.

Borrowing -  Banks are actively expanding their loan portfolio as the easy money polices of the government kick the economy into overdrive.

Investments- High inflation stymies major investment. When inflation rises materially above the federal target, investor confidence in the economy is reduced.

Employee wages - Typically, employees suffer more than companies due to inflation.In addition, inflation gives businesses an opportunity to reduce the cost of employee wages. 

Foreign exchange - As inflation occurs, the purchasing power of the dollar falls,  relative to other currencies. If the dollar falls in value, costs for international purchases increase.

But, it's quit important for consumers and businesses alike have to deal with the impact of inflation,  in both good and bad.