Mark-up of beer prices too steep: Case

SINGAPORE - Two separate surveys have shown that most food and beverage vendors in various parts of the island have marked up their prices of beer beyond the calculated excise duty of 41 cents.

Only three of the 23 vendors surveyed on the price of a 633ml bottle of Tiger Beer, which was chosen for the surveys, did not raise its price beyond 41 cents.

Among the vendors which hiked up their prices, two outlets run by Kopitiam, the biggest food chain operator here, had the steepest price increase.

Its outlet at Serangoon North Ave 3 had a price increase of $1.30 for a bottle of Tiger Beer, from its original price of $5.50. The other, at Simei Street 3, showed the second-highest increase of $1.20.

The surveys were conducted by the Consumers Association of Singapore (Case), with the first carried out on 11 vendors between Feb 28 and last Monday.

The second survey, involving 12 vendors, was carried out on Tuesday.

In both surveys, Case officers were sent as mystery shoppers to each establishment to buy a bottle of Tiger Beer.

The prices recorded in the surveys were subsequently compared with the Ministry of Finance's calculated price increase of beer due to the excise duty increases, said Case in a statement yesterday.

The surveys came after Case received feedback from customers that certain food and beverage outlets had increased beer prices by more than $1.

Following a 25 per cent excise duty hike on liquor which took effect on Feb 21, the Ministry of Trade and Industry had warned businesses about profiteering.

But shortly after Case released its survey results yesterday, Kopitiam took issue with what it called "incorrect data" in the results.

Its concerns, which were raised in a series of e-mail messages, included what it said was an inaccurate reflection of its beer pricing, as well as a wrongly stated address of its Serangoon North outlet.

The Kopitiam spokesman said t a Tiger Beer bottle at its Serangoon North outlet has been selling for $6.30 since last Tuesday. Case, which surveyed the outlet on Feb 28, had found the price to be $6.80.

The spokesman added that, as of Monday, the price of its bottled beer at its Simei Street 3 outlet is $6.50 and not $6.80, as surveyed by Case a week before.

In an e-mail reply, executive director Seah Seng Choon explained that its reflected prices were stated correctly as of last Monday - before Kopitiam made the price tweaks.

The Kopitiam spokesman added: "Our competitors are currently retailing at prices ranging from $6.20 to $7.90.

"We have and are still monitoring the situation, and adjusting our prices to respond to the market situation."

The Straits Times yesterday visited a coffee shop at Yishun Street 72, which was found to have increased its beer price by $1, to $6.80.

The managing director of the outlet, Mr Frank Ng, 44, said: "As it is, it's very hard to make money from selling beer because of the price hikes.

"With costs going up, we'd have to adjust accordingly."

He said that the price of beer increased prior to the tax hike due to an increased cost from suppliers.

Mr Ng added that he expects prices to go up further as manpower costs are also set to increase.

Kim San Leng coffee shop at Yishun Ave 11 has only hiked up the price of its beer by 30 cents so far.

Ms Florence Hoon, 59, who manages the coffee shop, said that it is "hard to tell" if its prices will go up as it pegs prices to those at nearby coffee shops.

The Competition Commission of Singapore (CCS) said yesterday that all businesses should determine their prices "independently", without colluding their prices with other shops.

"If there are suspicions of anti- competitive behaviour, such as collusion among retailers or coordination of prices initiated by trade associations, a complaint can be filed with CCS," said its spokesman in a statement.

Case president Lim Biow Chuan said that businesses should not "take advantage of consumers by raising prices without justification". Consumers are also urged to make "informed choices for their liquor purchases", said Mr Lim.

kcarolyn@sph.com.sg

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