Restos adjusting prices to cope with inflation

Food businesses particularly restaurants have been adjusting prices of their products to cope up with the rising inflation.

In an interview yesterday, Bunny Pages, chief executive of Cebubased Pages Holdings, which owns various homegrown restaurants, said businesses have been affected by the rising prices.

"We really have to adjust on prices to cope with inflation. Otherwise, the margins get really high and in business it doesn't make profit," Pages said.

"Businesses have to cope with inflation in the sense that they have to be more efficient. Price increases may be necessary but they have to make sure that value propositions are there," the businessman pointed out.

He said some of his businesses have raised prices of some of their products but are also making operations more efficient.

He noted businesses must generally face "tough times" like this and that they must also see the opportunity to grow and expand.

In a previous interview, Philippine Franchise Association president Richard Sanz also said retailers have been adjusting to the rising costs of raw materials.

"The retail sector, which includes F&B (food and beverage), restaurants and retail services are starting to feel the effects of the higher inflation," he had noted.

"We have started to see some establishments increase the selling prices of their products due to the increasing prices of raw materials like rice and sugar to compensate for shrinking profit margins," said Sanz.

In fact, SME establishments are just "absorbing the higher prices of raw materials because increasing their selling prices might decrease their sales volume further," he said.

Inflation has continued to rise since the start of the year when the government implemented a new tax law which imposes higher taxes on fuel and sweetened beverages.

In August, inflation further quickened to 6.4 percent, its highest in almost a decade.

Economists have said inflation might further soar in the last few months of the year.

But the government has insisted it is doing measures to tame inflation such as easing importation for food items like rice and it expects consumer prices to taper off by early next year. —