Supermarkets to raise prices to offset higher labor costs

Supermarket owners are planning to raise prices to offset the impact of rising labor costs.

The planned price increase will come alongside some manufacturers’ decision to jack up prices of their products due to the depreciation of the peso against the dollar, higher fuel prices and the surge in prices of raw materials.

“With the increase in labor cost, even though suppliers don’t increase their prices, we will increase our margins even a little,” Philippine Amalgamated Supermarkets Association president Steven Cua said.

“How do we cover for the wage increase. We can’t feed them peanuts, right? So expect a little increase in prices,” Cua added.

Minimum wage earners in the private sector in Metro Manila started receiving an additional P21 per day in their basic wage since last Oct. 5 following the approval of the Regional Tripartite Wages and Productivity Board-National Capital Region of Wage Order NCR-21 which prescribed new wage levels for all minimum wage earners and set the minimum wage for the non-agricultural workers to P512 from P491.

With the increase in prices of some noche buena items and basic commodities starting this month, Cua said consumers can soften the effect by buying the right products and brands.

“I do have products which have increased 10 to 15 percent and that’s big. But if you don’t know what to buy naturally you will really spend more than the usual,” he said.

“However, the increase was not across all products as it included only particular brands and particular sizes. That’s good because since it’s not all at the same time, consumers would have a choice,” Cua said.

Following a National Price Coordinating Council Meeting last Tuesday, Trade Secretary Ramon Lopez said a number of manufacturers of noche buena items and basic commodities have reported their respective price increases.

Despite the increase, Lopez said prices of these products remain below the suggested retail prices (SRP). “There were an increase for

noche buena products. For each category there are one or two brands that increased prices out of six or eight,” he said, citing products such as fruit cocktail, cheese, pasta, and spaghetti sauce.

Several brands of sardines, canned meat, and milk have likewise reported price hikes, but mostly those in the premium segment.

Lopez said because of factors like the depreciation of peso against the dollar, higher fuel prices, and the surge in prices of raw materials, some manufacturers were unable to retain their existing prices.