By Bequia Observer
How to ignore the basic rules of economics in one easy lesson:
Over the last few years, there has been an explosion of business in the fruits and vegetable section of the food market in Bequia.
The number of traders dealing in produce has more than doubled from within recent memory and, normally, that would be good for the consumer as one basic economic rule is that more competition brings lower prices.
But not in Bequia, and for one simple reason: collusion.
Now I’m not saying that dealers are getting together and deliberately setting prices, it’s just a little more complicated than that; it is, in my belief, what happens in a small community where everyone knows everyone and no one wants to step out of line.
The moment it becomes known that Vendor A is charging, for example, $9 a pound for tomatoes, then I will defy you to find anyone charging less than that. At least openly.
When you get a whisper in your ear that, “Hey, bro, don’t worry. For you, it’s $7 a pound” you think you’ve a special deal but I can assure you that even that is misleading. Try the same delaying tactic anywhere else and you’ll get the same story and the same reduction.
Anyone who bucks the system lasts a few weeks, maybe their idea being to attract new business at first but very soon they to fall into line and start charging the “standard” prices.
Because, in St Vincent, no true “wholesale” market exists as it does in larger countries, it is impossible to say for certain what traders are paying initially for the produce they sell but there has to be a huge variance in their costs for the same product. Some will buy from friends or relatives who are small farmers, some from other traders in Kingstown market, some have cold storage facilities so can buy in more bulk thus attracting discounts, other smaller traders buy from day to day almost and pay at the top end; whichever style they are, they have their own set of costs and expenses and without collusion, the set retail prices that the customer currently suffers should not exist.
Difficult although it may be, the Government, through perhaps the trading standards department, should investigate and at least show willingness to try to stamp out this practice which costs Grenadines consumers considerable amounts on a daily basis. At the very least, it would indicate Government’s “disapproval” of this pernicious practice and with that the hope that traders would choose to become more competitive to the benefit of consumers.
The views expressed herein are those of the writer and do not necessarily represent the opinions or editorial position of iWitness News. Opinion pieces can be submitted to [email protected]
The views expressed herein are those of the writer and do not necessarily represent the opinions or editorial position of iWitness News. Opinion pieces can be submitted to [email protected].