The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamian food retailers were yesterday “trying like hell” to meet Friday’s deadline to produce an acceptable alternative to the Government’s “catastrophic” price control expansion.

Philip Beneby, the Retail Grocers Association’s president, told Tribune Business that the industry was “working as hard as we can” to meet the tight timeline provided to come up with a solution agreeable to both sides as well as ease the cost of living crisis for Bahamian consumers.

Declining to provide details on any proposals for fear it will prejudice the outcome of negotiations with the Government, he indicated that coming up with a workable plan by Friday will be challenging given the need to consult both Family Island food merchants as well as wholesalers to gain their input.

“All I can say is that we’re working as hard as we can to see if we can come up with a suitable solution and one that the Government could accept,” Mr Beneby told this newspaper. “It’s not easy because we have to communicate with those in the Family Islands as well, and so we are trying as best we can to have it ready for Friday. It is a work in motion. It’s tight

“All I can say is we’re trying like hell to do so. We hope we do. Everybody is on board trying to work it out. It is a group effort, and we have to take consultation with the wholesalers as well. Dozens, dozens of people are involved. We’ll have to see how it goes. I can’t say too much. We don’t want to aggravate it. We want everything to be done in good faith, and don’t want to pre-empt our efforts. We’re working, we’re working. Give us a chance; let us see what we can come up with.”

Mr Beneby spoke out after the Association warned, in a statement, that expanding price control by 38 product categories would potentially cover up to 5,000 different line items due to the varieties involved. This would mark a major increase in products sold at a loss, or so-called loss leaders, with between 40-60 percent of a food store’s inventory covered by price control.

“While the Retail Grocers Association affirms its commitment to working with the Government of The Bahamas towards ensuring that food is affordable for Bahamians in these challenging economic times, the Association maintains that the impact of the recent expansion of the price control basket (PCB) will undoubtedly prove catastrophic to the local wholesale and retail industry,” the statement said.

“The Association wishes to again clarify that while the Government announced that 38 items would be added to the basket, it is in actuality 38 categories of foodstuffs, which would affect more than 5,000 items to which inventory and price adjustments would have to be made. To facilitate such changes would be a very expensive undertaking, and would mean that 40 to 60 percent percent of total revenues for local wholesalers and retailers would be controlled.

“Additionally, such a decision was made without prior industry consultation and at a time when businesses are faced with already slim profit margins, increasing electricity costs, increased operating expenses and theft. The sector employs some 4,000 persons, and the expansion of the PCB will undoubtedly have a ripple effect which would prove detrimental, with mass store closures, particularly among the smaller food stores and the real potential for food shortage in the country.”

The statement continued: “The Association is keenly aware of the effects of global inflation and the hardships being faced across the country by many Bahamians. Our collective objective is to provide the best prices possible to our customers. It is also worth noting that customers have been able to benefit from the pass-through reductions in Customs duties for some items.

“Our members have, and continue to contribute unselfishly, to all manner of charitable organisations and efforts throughout the country. The Association suggests the Government provide a more targeted approach to relief to those most in need of assistance. It is our hope to partner with the Government towards presenting some form of food assistance for the most vulnerable at this time.”

The Prime Minister, in unveiling the expanded price control regime, said it was for a six-month trial for food items and three months for pharmaceutical drugs, although there is every possibility it may be extended further.

Food wholesale margins, or mark-ups, are capped at 15 percent for all 38 product line items listed, while those for retailers are set at 25 percent across-the-board. Those goods impacted, some of which are already price controlled, are baby cereal, food and formula; broths, canned fish; condensed milk; powdered detergent; mustard; soap; soup; fresh milk; sugar; canned spaghetti; canned pigeon peas (cooked); peanut butter; ketchup; cream of wheat; oatmeal and corn flakes.

The remainder are macaroni and cheese mix; pampers; feminine napkins; eggs; bread; chicken; turkey; pork; sandwich meat; oranges; apples; bananas; limes; tomatoes; iceberg lettuce; broccoli; carrots; potatoes; yellow onions; and green bell peppers.