Retail prices to be kept on tight leash

Wiboonlasana Ruamraksa, director-general of the department, said that the rise in the daily minimum wage to Bt300, which will take effect early next month nationwide, would result in manageable cost increases for most goods producers.
“The department will not allow any traders to increase their prices next year. After production costs rise, including for small-scale manufacturers that will be hit hard [by the wage increase], enterprises should adapt their operations with increasing prices as their last choice,” Wiboonlasana said.
According to a study by the department, the impact of an increase in the daily wage from Bt245 to Bt300, or 22.45 per cent, would differ depending on the size of a manufacturer’s business. For large enterprises, the impact on production costs would range from 0.62-9.61 per cent.
For small and medium-sized enterprises, however, the impact would be 10-30 per cent. In the farm sector, the cost of labour will have a weight of 30-35 per cent of their production cost, and for logistics the weight is 30 per cent. In retail and wholesale, labour has a weight of 3-5 per cent of total production costs.
Currently there are about 16.39 million labourers in the Kingdom.
Wiboonlasana also noted that large enterprises in the palm-oil industry, soap and detergent would not be affected by the rising cost of labour next year as they are based in those provinces where the new minimum wage took affect this past April.
SMEs in garments, furniture, and leather goods industry will be impacted by only 2.24-6.47 per cent.
In the agriculture sector, the costs of rice and cereal producers will be affected by 6.73-7.86 per cent, tapioca, maize, and other protein crops will be affected by 0.94-1.38 per cent, and pork, eggs and vegetables by 1.93-2.51 per cent.
Goods transport will be affected by 6.73 per cent, and public transport by 4.5 per cent.
Retailing and modern trade will be affected by 0.67-1.12 per cent, and car-care service and nursing by 3.37 per cent.
Wiboonlasana said enterprises should consider increasing prices as their last choice as it could affect their competitiveness.
Meanwhile, the Commerce Ministry will on January 15 launch a website to inform consumers about retailing and wholesaling in 250 markets nationwide. The “Producer and Consumer Alert” site is aimed at protecting consumers and increasing fairness among traders, said permanent secretary Vatchari Vimooktayon.
The move is part of the government’s plan to curb inflation and control the rising cost of living next year, parallel to its policy to boost incomes. The ministry projects next year’s inflation at 3-3.5 per cent.
The new website will compare the prices of essential foods and goods in 250 markets. Those products will include vegetables, fruits, rice, chicken, pork, and other consumer products.
Vatchari said the website would not only help consumers, but also merchants to set prices fairly and appropriately.