Like every month, for the Spring Festival we received several glossy supermarket pamphlets advertising special offers, each about 20-pages thick. As usual, I threw them all into the recycle bin except for the one that was issued by the supermarket where we do our regular monthly shopping. And for once I really did have a good, close look at it.
Eleven of the 20 pages were dedicated to alimentation. Bar a few, all the listed items were on special offer; a total of +300 of them. The average discount was 20 percent (pc), but some 52 items carried discounts in the range of 25-43 pc. A few items were discounted between Rs 100 and Rs 450+. Imagine a saving of Rs 450+ on one single item!
If anyone were to buy all the items on special offer, he could make a saving of Rs 6k+.
Well worth it, I guess. Naturally, like everyone else I am very happy to get these special deals, and save money. But there are a couple of questions that have been nagging at me for some time.
- By definition special offers should be far and few between, so how come our supermarkets have hundreds of them every month of the year?
- If the supermarkets can still make a profit after giving discounts of 20-43 pc, then what is the size of their normal profit margins?
- Instead of spending good money on glossy pamphlets to advertise their special offers, why don’t these supermarkets just sell the articles at a reasonable price to the customer in the first place?
- Something obviously need to be done!
No doubt some bright spark will tell us that it is against WTO rules to control prices. But WTO is quite at ease with government (GM) controlling our incomes. It makes absolute nonsense to control only one side of the equation. If we are expected to accept a control on our incomes — as is common practice — then surely we should have a mechanism to rein in prices as well, and thus avoid any unfair exploitation of the consumer. Because when he sees discounts of 20+ pc on offer at the supermarket, then he can legitimately ask what lies behind this extraordinary largesse, whilst his annual COLA is usually tied to the CPI.
Something for the CPU?
Now it is common knowledge that there is a control on the profit margins on medical products, so one may ask why not on alimentation? And whilst we are at it, maybe government could consider abolishing VAT on foodstuffs because charging 15 pc may be putting them out of the reach of people on low income like old age pensioners. Two important matters for the authorities to consider, perhaps? If they are not already doing so.