Gold, dollar, petrol prices increasing, but goods’ prices staying firm
Supermarkets commit to not raise sale prices
Co-op Mart, Big C and Citimart all have confirmed that the prices of goods will not go up following the petrol price increase decided upon on August 8. The low demand has forced retailers to accept lower profit to boost sales and they believe it is unwise to think of raising sale prices at this moment.
Deputy Director of Citimart Ngo Van Hai admitted that sales have been very slow. Citimart’s revenue has dropped by 15-20 percent from the same period of last year.
Duong Thi Quynh Trang, Public Relations Director of Big C Supermarket, affirmed that even if suppliers raise prices because of higher input material prices, Big C will not raise sale prices, but will accept lower profit. Trang said that consumers are tightening their belts, and sale price increases will make the stagnant sales even slower.
The supermarket is even launching promotion campaigns at present, offering attractive price discounts to lure more customers.
Vu Vinh Phu, Chairman of the Hanoi Supermarket Association, also said that local supermarkets are being forced to do one thing which they never had to before: accept breaking even. As demand has decreased dramatically, big volumes of goods have been left unsold.
Transport fees will be raised if petrol prices rise further
Transportation is a sector which bears direct influence from petrol price increases. However, service providers have not made any adjustments to service fees so far. Chairman of the Vietnam Automobile Transport Association Nguyen Manh Hung said that the association has not heard any intention from its members to raise transport fees, even though petrol and oil prices have increased. However, they say transport feed will be raised if the petrol and oil prices exceed the 15,000 dong per litre threshold.
With the 6th petrol price increase since May 2009, transport costs have increased by 2 percent.
Representative from the Hanoi Taxi Association has also affirmed that taxi firms do not intend to adjust fares. However, he said that they will do that if the petrol price increases by another 1,000-2,000 dong per litre.
Prices won’t increase because of low demand
Dr Ngo Tri Long, former Deputy Head of the Price and Market Research Institute under the Ministry of Finance, said that housewives fear the prices of goods will go up to follow the price increases of gold, dollar and petrol. In the past, goods’ prices increased every time petrol prices were raised. However, the situation is different now. It is simply because low demand does not allow producers to raise sale prices.
Phu also believes that goods’ prices will not increase at least until the end of October as demand is forecast to be low in the lowest season in the year. The demand may increase slightly in the last months of the year, if Vietnam’s and the world’s economies recover.
