Merchants report increases in prices; they ask Medina to find a solution
Electricity and lack of cheap credit are among the problems which affect them the most
Diario Libre
SANTO DOMINGO. The commerce of foodstuffs (groceries), the same as other economic sectors of the Dominican Republic, is going through a critical situation at the present time. This is reflected in the pockets of the consumers who are paying more for a large number of products that have increased their price over the last few months.
This situation that the commercial sub-sector of groceries is going through has caused some products to increase their prices by as much as 65% and a downturn in sales that is placed at around 20%, according to the reports from the principle leaders of several merchant federations grouped in the Confederation of Merchants and Pymes of the Dominican Republic (Confecomercio).
Among the products that have increased in price according to an analysis carried out by the Confecomercio, which covers the period between 30 July 2012 and 27 September 2013 are: Herring, which had an average price of RD$63.50 and at the present time it is sold at RD$105, which is a 65% increase; Select rice, from RD$!9 a pound to RD$21, an 11% increase; Garlic from RD$105 to RD$150, an increase of 43%; Cod, fromRD$125 to RD$140 means a 12% increase, and red onions were RD$30 and now are RD$32, a 7% increase.
As they report on the situation that the merchants are experiencing, Gilberto Luna, Accompanied by Rafael Santos, Dionicio Quiñones, Ricardo Rosario, and Luis Taveras, executives of the Confecomercio who took part in the Dialogo Libre, said that the tax reform that was approved last year and the downward slide of the dollar contributed to the basic products increasing their prices.
"This has been basically what has contributed to these products increasing in price by about 25%, since the companies also had to make adjustments in their costs and therefore increased the prices of their products," said Luna.
Moreover, the merchant said that given the situation that the business is going through it is necessary for President Medina to give them a little time to listen to this sub-sector.
After explaining the cases that affect the commerce, Luna stressed that the energy problem is one of those that most influence the operational costs of the merchants, since the electricity is deficient and expensive.
He added that, in addition, the stores have to have inverters or gensets to supply electricity. "The corner markets are losing, the smaller supermarkets are losing, each day that goes by, the consumer and demanding public,' he said.
Other difficulties which "at the end of the day" force consumers to pay more for the articles they purchase, he said, are that this commercial sub-sector of groceries has to deal with the challenge of what it means to look for cheaper financing.
"They talk about credit a lot, they talk about preferential interest rates, they talk about how the money is in the banks and that it is there that you have to go to find it. But try and get it!," commented Luna as he stressed that credit for merchants represents another cost that is then transferred to the products they sell.
The merchant leader said that the requirements which the banks present for commerce are the same or greater than those that existed before and that this contributes to the smaller merchant have less and less access to the loans that the government is talking about through the Pymes and the banks.
A feeling that Merca Santo Domingo will be feasible
Luis Taveras, who is an executive of Confecomercio and of the Union of Vendors of the New Market on Duarte, said that Merca Santo Domingo, which was begun in 2001, is already in the process of remodeling for the start of its operations.
He said that the Merca SD is a project that the merchants thought was prejudicial to their interests but now they understand that this is a novel project that will be feasible.
Nevertheless, the merchant said he felt that the wholesale sector is going to have to modify some aspects of their operations in order to insert itself into this system of business.
Taveras said that although some details a missing for the startup of operations at Merca SD, there are already important sectors that have been signing contracts to take part in the project.
Expenses at the corner markets represent 23.25% of their sales
According to the evaluation of the monthly costs in relation to the sales of the corner markets, Confecomercio presented a chart where it detailed the different expense items that these markets have. Among these it is stressed that a market with an average sales of between RD$400,000 and RD$450,000 a month, has energy costs of RD$15,000, rent of RD$21,000 and salaries of RD$30,000.
There are also the cost of communication (telephones, cable TV and Internet) RD$3,000; food for employees at RD$15,000; fuel for the emergency generator and motorcycles (RD$3,000); taxes for RD$3,000; miscellaneous expenses for RD$10,000, all of which represent 23.25% of the sales.
This situation that the commercial sub-sector of groceries is going through has caused some products to increase their prices by as much as 65% and a downturn in sales that is placed at around 20%, according to the reports from the principle leaders of several merchant federations grouped in the Confederation of Merchants and Pymes of the Dominican Republic (Confecomercio).
Among the products that have increased in price according to an analysis carried out by the Confecomercio, which covers the period between 30 July 2012 and 27 September 2013 are: Herring, which had an average price of RD$63.50 and at the present time it is sold at RD$105, which is a 65% increase; Select rice, from RD$!9 a pound to RD$21, an 11% increase; Garlic from RD$105 to RD$150, an increase of 43%; Cod, fromRD$125 to RD$140 means a 12% increase, and red onions were RD$30 and now are RD$32, a 7% increase.
As they report on the situation that the merchants are experiencing, Gilberto Luna, Accompanied by Rafael Santos, Dionicio Quiñones, Ricardo Rosario, and Luis Taveras, executives of the Confecomercio who took part in the Dialogo Libre, said that the tax reform that was approved last year and the downward slide of the dollar contributed to the basic products increasing their prices.
"This has been basically what has contributed to these products increasing in price by about 25%, since the companies also had to make adjustments in their costs and therefore increased the prices of their products," said Luna.
Moreover, the merchant said that given the situation that the business is going through it is necessary for President Medina to give them a little time to listen to this sub-sector.
After explaining the cases that affect the commerce, Luna stressed that the energy problem is one of those that most influence the operational costs of the merchants, since the electricity is deficient and expensive.
He added that, in addition, the stores have to have inverters or gensets to supply electricity. "The corner markets are losing, the smaller supermarkets are losing, each day that goes by, the consumer and demanding public,' he said.
Other difficulties which "at the end of the day" force consumers to pay more for the articles they purchase, he said, are that this commercial sub-sector of groceries has to deal with the challenge of what it means to look for cheaper financing.
"They talk about credit a lot, they talk about preferential interest rates, they talk about how the money is in the banks and that it is there that you have to go to find it. But try and get it!," commented Luna as he stressed that credit for merchants represents another cost that is then transferred to the products they sell.
The merchant leader said that the requirements which the banks present for commerce are the same or greater than those that existed before and that this contributes to the smaller merchant have less and less access to the loans that the government is talking about through the Pymes and the banks.
A feeling that Merca Santo Domingo will be feasible
Luis Taveras, who is an executive of Confecomercio and of the Union of Vendors of the New Market on Duarte, said that Merca Santo Domingo, which was begun in 2001, is already in the process of remodeling for the start of its operations.
He said that the Merca SD is a project that the merchants thought was prejudicial to their interests but now they understand that this is a novel project that will be feasible.
Nevertheless, the merchant said he felt that the wholesale sector is going to have to modify some aspects of their operations in order to insert itself into this system of business.
Taveras said that although some details a missing for the startup of operations at Merca SD, there are already important sectors that have been signing contracts to take part in the project.
Expenses at the corner markets represent 23.25% of their sales
According to the evaluation of the monthly costs in relation to the sales of the corner markets, Confecomercio presented a chart where it detailed the different expense items that these markets have. Among these it is stressed that a market with an average sales of between RD$400,000 and RD$450,000 a month, has energy costs of RD$15,000, rent of RD$21,000 and salaries of RD$30,000.
There are also the cost of communication (telephones, cable TV and Internet) RD$3,000; food for employees at RD$15,000; fuel for the emergency generator and motorcycles (RD$3,000); taxes for RD$3,000; miscellaneous expenses for RD$10,000, all of which represent 23.25% of the sales.
Diario Libre
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