The Tribune

By NEIL HARTNELL

Tribune Business Editor

SUPER Value's owner yesterday warned the price of many grocery items is likely to increase by at least 2-3 per cent, having been told that freight rates will rise by 10 per cent due to the new/revised charges being imposed by the Arawak Cay Port.

Explaining that the supermarket chain was looking to economies of scale gained from its impending acquisition of City Markets' remaining four New Providence stores to help minimise the impact of increased freight charges, Rupert Roberts indicated to Tribune Business he had little choice but to pass some of the burden on to Bahamian consumers.

Noting the cost savings to be enjoyed from servicing a larger number of stores using the same warehouse and administrative structure, together with the greater buying power, Mr Roberts said: "We'll be able to keep prices down and, in some cases, reduce some margins."

But, in the next breath, Mr Roberts, who is also Super Value's president, told Tribune Business: "In some cases there's going to have to be some increases.

"We've been notified that with the new Port, there's a $200 increase per container. That's like a 10 per cent increase in freight rates... It's going to affects the cost of groceries 2-3 per cent. Costs are creeping up."

Mr Roberts' assessment is more bad news for hard-pressed Bahamian consumers, any of whom have already seen incomes cut or come under pressure as a result of the recession. Price increases on staple items, such as groceries, further raise the spectre of increasing inflation in 2012.

The Central Bank of the Bahamas has already sounded warned bells on this, noting that inflation for the 12 months to end-February 2012 had risen to 3.3 per cent, compared to 1.5 per cent a year ago. It said food and drink costs had risen by 2.2 per cent.

Tribune Business has been the only newspaper to warn that the increased fees/new charges set to be levied by the Arawak Cay Port, in part to pay for its $83 million construction, would be passed on - at least in part - to Bahamian consumers and the private sector.

Crowley Caribbean Services told this newspaper last month that the new tariff structure would make Nassau "one of the most expensive ports in the Caribbean, adding that it had "never seen" such fee increases all coming at the same time.

Meanwhile, Mr Roberts told Tribune Business that he anticipated no real problems in integrating the former 200-300 City Markets employees with Super Value's staff, once the takeover of the four New Providence stores went ahead.

As revealed by this newspaper on Wednesday, Super Value is only waiting on the approval of Shop Licences for those locations by the Government to close the deal with the Finlayson family-owned Trans-Island Traders, the vehicle that holds the 78 per cent equity stake in Bahamas Supermarkets.

City Markets' line staff is unionised, while Super Value's is not, the latter's having rejected unionisation back in 2005. Mr Roberts, though, expressed no concern about this, indicating he believed integrating the two sets of employees would not present a problem.

"We've done this before," he told Tribune Business. "When we took over Portion Control they had a union. When we brought their staff up to our salary scale and working conditions, the union fell away. But any staff member wanting to pay union dues, I can't object to that."

Mr Roberts said Super Value had been interviewing City Markets staff over the past three-four days, adding that he was already in need of more employees for his existing 10-11 stores.

"We'll be interviewing all of their staff," he told Tribune Business. "We need more staff now for Super Value. So many people out there need jobs, and it's so difficult to get good staff.

"We're always looking for good staff, and quality staff will be coming on board. We'll retrain them our way, and put trained staff in those stores."