Is it really comforting to you that our federal government has demanded supermarket chains hold their prices?
Going from the dream world of politicians to the harsh realities of the marketplace, this means the supermarkets would have to stabilize all their own input costs or lose money and close their doors.
What are the input costs? Well, let’s start with wages.
Is our concerned government going to roll back the wage increase just negotiated for the employees of Metro stores? And will the politicians in Ottawa stymie the present demands of the Loblaws store workers?
I hope not, because they need that money to survive inflation. Get real. Guess where the money has to come from – the price of your shopping basket.
Another input cost is the goods on the shelves.
Are we going to tell the banana growers in the tropics, the out-of-our-season berry growers in Latin America and the vegetable growers in California that we aren’t going to pay what they demand for their produce?
There are lots of consumers in other countries that will pay their price. Maybe we can get by without fresh or canned or frozen fruit and vegetables. But not if we want proper nutrition.
And we know there is a worldwide shortage of grains – you know, the stuff they use to make the bread and cereals we eat every morning.
These carry global “market prices” that are not controlled by the politicians in Ottawa. It’s a bidding war for food, and the higher bidders get to eat regularl
And of course, there are those pesky petroleum prices. The truckers who bring the goods to the stores expect to get compensated for every hiccup in the price of gas – pushed upward by well-intentioned but impactful carbon taxes.
And these grocery stores are facing the increasing cost of leases.
Lease expenses will escalate as financing costs leap upward for the money borrowed to finance the property and the money needed to run the business. So, is Ottawa going to reduce or subsidize interest costs for Canada’s supermarkets?
If I haven’t dreamed it (or maybe it was more of a nightmare) the Bank of Canada has been working strenuously to substantially increase interest costs.
Where is this all going? If you’re like me, you feel caught in a revolving door that may never stop going around.
We reel around dizzily as packages shrink, food quality drops (hard to find any almonds in my favourite raisin and almond cereal), and we realize that we are competing for sustenance on a planet of 8 billion people.
It’s a depressing thought and I don’t like it any more than you do. But Ottawa will never solve the problem by the camouflage of freezing (or what it calls “stabilizing”) prices.