Yakutia bread prices up 4%, further hikes feared
The Yakutsk Bakery Combine has announced a price increase for bread and bakery products of 4 to 7%, depending on the category. The bakery«s marketing department told 14.RU on February 4.
«The wholesale price is rising because raw material prices are increasing. In addition, utility costs, logistics, and packaging and containers have gone up. The price in our branded retail stores will also rise,» the marketing department explained.
The price of bread will rise from February 5, the YBC clarified. If the wholesale price for first-grade bread was 51 rubles (about $1 at current rates), it will now reach 54 rubles (about $1). Store markups must also be added. The bakery hopes Yakutians will understand the price increase.
The Yakutsk Bakery Combine raised bread prices by 10% in March last year. For example, at Pyatyorochka, wheat bread from YBC made from premium flour was already sold for 142 rubles (about $2), while first-grade bread was almost three times cheaper at 51.99 rubles (about $1).
The Nemugiunsky Bakery raised prices in January by 2.8%, commercial director Yevgeny Nikiforov told 14.RU. Again due to rising raw material, electricity, and fuel costs.
«We raised the wholesale price, and the stores themselves determine the retail price of bread. If white bread went up by 2 rubles (about $0), then confectionery rose by 5 and 8 rubles (about $0 each). Everything due to rising flour prices: compared to last year, it has gone up by another 3.9 rubles (about $0). Electricity and transport costs are also rising,» Nikiforov explained.
Another increase may occur in April. Nikiforov links this to changes in the tax code for entrepreneurs.
Since January 1, all companies and individual entrepreneurs on the simplified tax system whose income exceeds 60 million rubles (about $666,700) per year are required to pay VAT (5, 7 or 20% depending on turnover). Previously, they did not pay it.
«We fear that prices will skyrocket in April because retail outlets have become VAT payers, but they are still calculating their percentages under simplified taxation. Now they will actually pay the tax and will be shocked. And from April 1, they will raise prices manifold,» Yevgeny Nikiforov predicts.
The Nemugiunsky Bakery raises prices every year in January. So far, bakery product sales at the enterprise have remained at the level of last year, but confectionery has slumped. According to Yevgeny Nikiforov, retail outlets reported that revenue compared to December fell by two or three times: people are not buying anything.
