Traders have to rely on volume to keep sales rolling

PETALING JAYA: Maintaining a reasonable volume of sales to avoid extra overhead costs is among the efforts taken by food operators to cope with pricier raw cooking materials, says a trading group.

Petty Traders and Hawkers Association president Datuk Rosli Sulaiman said the price of most cooking ingredients such as spices has increased between 50 sen and RM1, forcing traders to translate the price into the food they are selling.

“Almost all raw materials have increased from 50 sen to RM1. This would also cause the traders to increase the price of the food they sell.

“Even with that, they can only generate a small profit margin,” he said when contacted.

To adapt to the price change, Rosli has advised the public to control their spending and buy only what they need, especially during the fasting month.

“I’m aware that some customers have complained that the food in the Ramadan bazaars is getting expensive, but they need to understand that this is because of the higher business operating costs.

“Traders have no other option but to raise the price of their products; the public can always choose other stalls or operators that they feel have more reasonable price tags,” he added.

Checks by The Star on the ManaMurah portal, a platform that captures prices of food items from the Domestic Trade and Cost of Living Ministry and Statistics Department, found that the weekly national average price of goods increased by 0.3% between March 18 and 22.

Sarawak had the highest average price increase of goods compared with the national figures at 6.9% higher, followed by Labuan (6.3%), Putrajaya (6.2%) and Sabah (4.4%).

The platform also showed that the price of imported dry raw materials such as onions, garlic, potatoes and nuts has also recorded a higher national average than the week before.

The website showed that dried herbs such as white pepper, coriander seeds, cloves and cardamom have risen to 10 sen per 100g.

Petaling Jaya Coffeeshop Association said global ingredient supply disruptions and higher rent as businesses adapt to the post-Covid-19 pandemic should justify price hikes on food, which could reach up to 10%.

Its president Keu Kok Meng said the increasing cost of operating businesses comprising logistics, electricity and water and supply disruptions due to global uncertainties have impacted the food and beverage sector.

“A standard serving of noodles in a coffee shop increased by about 10%,” he said.

“You might say that this is quite a lot, but the cost of ingredients and other costs have increased by more than 10%,” he added, citing domestic wheat flour supply disruptions that are causing the spillover effects.

He said that this is also due to the higher rent for a stall on some premises, which requires higher fees from owners.

“Rent prices have risen by thousands (ringgit) in the last year, with landlords simply explaining that they have held back rent increases compassionately during the pandemic,” Keu said.

Aside from the rent, he also said the price hikes for food are due to the revised minimum wage order, which caused operators to spend more on labour.

“Wages have increased across the board by at least 25% because of the increase in the minimum wage,” he said, adding that the utility bills are another factor.

Keu added that coffee shop operators are not reducing their portion – which is also known as “shrinkflation” in the West – just to cover the costs of making the food, as this would affect customers’ loyalty.

“Those who do that would run out of customers, as customers are very thrifty. “We just need to work harder and get more support from our customers.

We understand that this is not an easy situation for them too,” Keu said.