Inflation hitting food manufacturers and food sellers hard

[webfact]

 

Inflation is taking a toll on food manufacturers and restaurant owners, forcing them to adapt to keep their businesses afloat even as consumers cut back on expenses. Soaring energy bills and the price of raw materials are making it hard for manufacturers and retailers to keep up with surging operational costs without adjusting their prices.

 

The Trade Policy and Strategy Office recently reported that inflation rose 7.1% in May year-on-year, taking it to a 14-year high. The rate accelerated from  4.7% in April.

 

Prices, particularly for eggs and meat, have been climbing since January due to the pandemic and surging energy costs as a result of the Russia-Ukraine crisis have worsened the situation.

 

For any household, skyrocketing costs of staples and household items mean they have to squeeze their budgets even further. The prices of 289 items of products and services have gone up including electricity bills, cooking gas, vegetable oil, pork, chicken, vegetables, eggs, and ready-to-eat food.

 

Full story: https://www.thaipbsworld.com/inflation-hitting-food-manufacturers-and-food-sellers-hard/

 

-- © Copyright Thai PBS 2022-06-23

 

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[Excel]

From that article "

Matthew worked as a chef at JW Marriott Sukhumvit Hotel. In late 2020, he quit to open a steakhouse of his own. His business ran smoothly last year thanks to the government’s Khon La Khrueng co-payment subsidiary scheme that allowed individuals who buy goods from local shops and restaurants to pay only half the price for their purchases, while the government subsided the other half. But when a fourth phase of the scheme expired in April, his restaurant’s sales quickly dropped. The high costs of food and oil in May has rubbed salt into his wounds.

“Over 70% of our revenue came from customers who used the Khon La Khrueng (half-half) scheme,” he said."

 

That hardly seemed a sound business plan if it was calculated upon the government giving 50% contribution for the diners. Inflation is ripping throughout the world, Thailand being no exception but if you think you can build and maintain a business on government hand-outs then that seems naive to me.

[RafPinto]

What's the rate of inflation here again?

Don't tell me, something like 4 %

 

Soon, the BOE have to act but can they?

Many have borrowed up to their necks.

[KhunLA]

One of my favorite restaurants is holding steady on their prices, and serving sizes haven't suffered.  Appreciate it, and frankly, don't know how she's doing it.  Definitely takes a hit, profit margin wise.  Repeat customer, I'll always be, even when the price increases eventually hit.  Same with a couple other favorites.

 

They did stop offering pork dishes, when silly priced, and just last month, started offering again.

[RichardColeman]

1 hour ago, Excel said:

“Over 70% of our revenue came from customers who used the Khon La Khrueng (half-half) scheme,” he said."

Seems the government in Thailand have about the same idiotic idea of lots of free money not leading to inflation as the US !

[Excel]

Just now, RichardColeman said:

Seems the government in Thailand have about the same idiotic idea of lots of free money not leading to inflation as the US !

UK and many more can also be included in that.  In hindsight the so called economic brains, graduating from some of the best universities in the world , have simply led the world astray. Or was it simply to make the worlds 0.1% wealthiest even richer ?

[vivananahuahin]

Special calculator.

[sandyf]

2 hours ago, Excel said:

That hardly seemed a sound business plan if it was calculated upon the government giving 50% contribution for the diners. Inflation is ripping throughout the world, Thailand being no exception but if you think you can build and maintain a business on government hand-outs then that seems naive to me.

Exactly. When the scheme was running we went to a steakhouse in Chonburi a few times, their normal prices were not in a range we would normally pay.

I came back from the UK a couple of weeks ago and while there walked into several Wetherspoons, cost of living crisis would be the last thing that came to mind.

[kickstart]

5 hours ago, sandyf said:

Exactly. When the scheme was running we went to a steakhouse in Chonburi a few times, their normal prices were not in a range we would normally pay.

I came back from the UK a couple of weeks ago and while there walked into several Wetherspoons, cost of living crisis would be the last thing that came to mind.

I go with that ,I paid 2.80 GBP for a good pint of beer ,and they food menu prices have not gone up that much.

But,I cooked a lamb hot pot , and an apple crumble the brought ingredients cost me 20 GBP plus,one meal for 3 people ,it was ok for us but low earning people that would be a lot .

Read a report saying more people are turning to more junk food ,cheaper than buying all the ingredients to make a dish.

All right, but with the resulting inevitable heath problems it will be the heath service that will have to pick up the pieces. 

[MrJ2U]

10 hours ago, Excel said:

From that article "

Matthew worked as a chef at JW Marriott Sukhumvit Hotel. In late 2020, he quit to open a steakhouse of his own. His business ran smoothly last year thanks to the government’s Khon La Khrueng co-payment subsidiary scheme that allowed individuals who buy goods from local shops and restaurants to pay only half the price for their purchases, while the government subsided the other half. But when a fourth phase of the scheme expired in April, his restaurant’s sales quickly dropped. The high costs of food and oil in May has rubbed salt into his wounds.

“Over 70% of our revenue came from customers who used the Khon La Khrueng (half-half) scheme,” he said."

 

That hardly seemed a sound business plan if it was calculated upon the government giving 50% contribution for the diners. Inflation is ripping throughout the world, Thailand being no exception but if you think you can build and maintain a business on government hand-outs then that seems naive to me.

......And naive to open a steakhouse in the middle of a pandemic. 

 

Few tourists.

 

Most Thais aren't interested in spending big money on a slab of beef. 

 

 

[mania]

12 hours ago, webfact said:

The prices of 289 items of products and services have gone up including electricity bills, cooking gas, vegetable oil, pork, chicken, vegetables, eggs, and ready-to-eat food.

Problem with this inflation driven rising prices is of course the sellers will next raise prices too

But if/when this inflation dies down do you think anyone will lower prices?

 

Possibly the end of one of the biggest attractions in Thailand, inexpensive meals

[hotchilli]

19 hours ago, webfact said:

For any household, skyrocketing costs of staples and household items mean they have to squeeze their budgets even further. The prices of 289 items of products and services have gone up including electricity bills, cooking gas, vegetable oil, pork, chicken, vegetables, eggs, and ready-to-eat food.

Gouging... no other term for it.

[hotchilli]

18 hours ago, RafPinto said:

What's the rate of inflation here again?

Don't tell me, something like 4 %

 

Soon, the BOE have to act but can they?

Many have borrowed up to their necks.

Near where I live I know 5 teachers, ages range from 25-45

all 5 have bought new cars this year?

Some seem to be doing alright.

[KhunLA]

7 hours ago, mania said:

Problem with this inflation driven rising prices is of course the sellers will next raise prices too

But if/when this inflation dies down do you think anyone will lower prices?

 

Possibly the end of one of the biggest attractions in Thailand, inexpensive meals

High inflation seem to be across the board ... worldwide.

So all things being equal, not much of a change.

[Petey11]

On 6/24/2022 at 1:28 AM, hotchilli said:

Near where I live I know 5 teachers, ages range from 25-45

all 5 have bought new cars this year?

Some seem to be doing alright.

Possibly on the never never loan?