Surcharges on retailers are fair
The Thai Retailers Association insists that the fees charged by modern-trade retailers are fair to both the traders themselves and their suppliers, and that they do not therefore need to be changed.
The TRA made the announcement yesterday following recent news that the Commerce Ministry had appointed a working group to look into the fees that modern-trade retailers charge suppliers.
Association president Busaba Chirathivat said through a press statement that the fees that such retailers charge their partners are normal business operation expenses such as transportation, distribution and marketing fees.
The charging of these fees is practised by all businesses and can be verified, she said in the statement.
Modern-trade retailers and suppliers agree to the fees voluntarily, based on business decisions and the market mechanism, she said.
Since all suppliers always carefully calculate their business feasibility, the agreement to these fees signifies that suppliers consider business dealings with modern-trade retailers to be viable and profitable. Modern retailers are neither in the position nor have the power to force suppliers to enter into a business arrangement if they do not wish so, the statement said.
Modern-trade retailers have long attached great importance to the development of long-term relationship and mutually beneficial cooperation with their suppliers, as each party is very important to the success of the other, she said, adding that the fees are therefore always considerate of suppliers’ business opportunities and long-term potential.
The amount of products sold through modern retailers is still lower than the level sold via traditional stores. As such, suppliers always have the choice to choose whether to sell through traditional or modern-trade operators. Modern-trade retailers do not have any power to force suppliers or conduct unfair trade practices, and many suppliers have chosen to sell only though the traditional trade and not through the modern trade, she said.
Meanwhile, the TRA said it stood ready to help look into any suppliers’ concerns as to high fees or unfair trade practices. Suppliers are welcome to raise their concerns directly with the association, but it has not yet received any complaints on the matter.
Busaba said the TRA wished to reassure the government, business suppliers and consumers that modern-trade retailers had not been trying to take advantage of or rip off consumers.
On the contrary, she added, they have been conducting their business based on fair trade practices, the market mechanism and an emphasis on mutually beneficial long-term partnership – with the ultimate goal of lowering the cost of living and providing maximum value for consumers.
The TRA has been regularly monitoring its members’ trade practices and therefore is certain that all business conduct of modern-trade retailers is fair, she insisted.
