Tania Tan & Lim Wei Chean, Straits Times 4 Feb 08;
Only one in four has raised prices to cope with higher costs; but some now serve smaller portions
THOSE who sell cooked food are usually not keen on raising their prices, but Madam Chen Yi Ye had to bite the bullet.
The 66-year-old, who runs a Taiwan porridge stall with her husband at the Old Airport Road hawker centre, upped the prices of 10 out of 30 dishes on the menu - including the popular bean sprouts fried with salted fish - by 50 cents.
She said: 'We prefer not to increase our prices, but this time round, we couldn't afford not to.'
Going by a survey by the Department of Statistics, she is in the minority - one quarter of hawkers have jacked up their prices as a result of higher food, fuel and labour costs. The remaining three quarters have held their prices steady since last June.
Minister of State for Trade and Industry Lee Yi Shyan, praising the majority for doing so, said that by not passing on the extra costs to their customers, they have done their bit to moderate the pace of price increases.
Speaking at the Kampong Chai Chee Chinese New Year celebrations at Bedok Central yesterday, he noted that, despite Singapore's having to import most of its food, prices have also been kept steady through a number of measures.
Firstly, the Agri-Food and Veterinary Authority has diversified food sources so the country is less at the mercy of supply or other problems from any one source.
Secondly, the open competition in the business environment means customers can go elsewhere if they find the prices unreasonable.
Madam Chen put it simply: 'We'd rather lose profits than lose customers.'
But while prices may be held steady, hawkers can - and do - give smaller portions to cope with increased costs.
Mr Zainal Onan, 45, for example, sells chicken rice in Clementi West daily and chicken briyani as well on Fridays. He said that with briyani, he cannot avoid giving the quarter chicken that is traditionally a part of the dish, so he has raised his price by 50 cents to $4.
With chicken rice, however, he hinted that he can 'control the size of the portions better', while charging the same.
Mr Ang Kiam Meng, who heads the Restaurant Association of Singapore, said restaurants were sensitive to prices and competition was stiff, 'so everyone will try to absorb the cost for as long as they can before passing it on'.
His own chain of Jumbo seafood restaurants has seen prices of crabs, for example, go up from $16 to $24 per kg, but prices of crab dishes there have gone up from $18 to only $22 per kg - barely enough to cover the overall increases in labour, rental, fuel and other costs, he said.
Mr Png Koon Heng, who chairs the Association of Chinese Wheat Flour Merchants of Singapore, confirmed that increased costs are hurting the food industry's bottom line.
The price of a 25kg bag of wheat flour, used to make noodles and breads, has been upped thrice in the last year: by $1.70 on Sept 15, then by $6 on Oct19 and again by $2.80 on Dec 24.
He said: 'Everyone thinks that things are good for us. But we have been feeling the pinch for some time now.'
Even with the price increases, profits have gone down, not up, he said.
He cited his own example: In the past, when his costs were $20, he earned $1.50. Now, his costs are $30, but he still earns only $1.50. His margins have shrunk.
'Nowadays, what most people make is just enough to cover costs. Sometimes, they even have to take losses,' he said.
