The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

AML Foods chairman yesterday blasted the “dogmatic” approach taken by the Government’s Price Control Department for damaging its Solomon’s Fresh Market brand, warning that profits were being threatened by an insistence that all products in certain categories be regulated.

Arguing that the Department was being “downright foolish” in its interpretation of the law and regulations, Dionisio D’Aguilar said regulators were demanding that high-end, organic products in categories such as milk and cheese be price-controlled as well as generic brands.

Suggesting that this was not what Price Control was designed for, Mr D’Aguilar said the Department’s demands could wreak havoc on Solomon’s Fresh Market’s margins and profitability, forcing it to raise prices even more on other items to compensate for an increase in those that were price controlled.

Calling for Price Controls to be “done away with”, the AML Foods chairman told Tribune Business: “We’re being harmed by Price Control.

“The Price Control Act stipulates that certain items are price-controlled. Everyone gets that and understands that. But, if you have milk, the Price Control Department is claiming that all products - even the organic ones - are subject to Price Control.”

Mr D’Aguilar indicated the same was happening with cheese, with Price Control demanding that high-end, organics brands sourced from locations such as the Swiss mountains, be price controlled along with generic brands, such as Kraft.

“They’re saying all products must be price controlled. It’s damaging the organic, fresh food model by holding the line on Price Control,” Mr D’Aguilar told Tribune Business.

“They’re being completely unreasonable. They’re interpreting the Price Control regulations in a silly manner. It was never intended for this. They’re being dogmatic, unreasonable and downright foolish. They’re going to damage the organic, Fresh Market model.

“They’re being a nuisance, coming in there, being unreasonable and silly, and saying high-end items are subject to price control simply because they’re cheese and milk.”

Mr D’Aguilar said Price Control inspectors had to realise that when the regulations were first implemented, there were just one or two brands in each product category, as opposed to the multiple ones in existence today.

Calling for Price Control to be “reasonable and sensible” in its application of the regulations, the AML Foods chairman said the situation could potentially impact profits and margins.

“Obviously, you don’t make any money on price controlled items,” Mr D’Aguilar said. “This is one of the problems with Price Control; it forces you to lose money on certain staples, and you have to jack up prices on the healthy items to make a profit.

“Price Control should be done away with. It’s not having the intended effect. It;’s making healthy products more difficult to purchase, because food stores have to charge more on other items to cover losses on price controlled items.

“If they start to apply this dogmatic rule to every product in a particular category, all the cheeses and milk we bring in, we might as well give up and go home. These bureaucrats have to show a certain amount of common sense.”

Pointing out that food stores were major employment and government revenue generators, as major payers of Customs duties, real property tax, Business licence fees and NIB contributions, Mr D’Aguilar said the industry’s margins were “very small”.

Calling on Price Control to “back off” and understand the economic contribution food stores made, Mr D’Aguilar said they “keep hammering food stores”.

“It’s difficult enough to make a living in that business,” he added. “Just be reasonable. If it doesn’t sound reasonable, don’t apply it. It’s getting really annoying. They keep jumping up at Solomon’s Fresh Market stores.

“It‘s almost like they want to put us out of business, and I’m sure Price Control wasn’t set up to put us out of business.”