Finance Minister Michalis Sarris has a lot to thank Nicos Shacolas and the NK Shacolas Group who took the initiative and pledged that when the euro is introduced on January 1, 2008, they will commit themselves to fair pricing and after conversion, they will round-down prices by up to 1% on all items.
With a combined CYP 270 mln or EUR 463 mln annual volume forecast for 2007, the promise by Shacolas has sent a positive shockwave to most other business enterprises that are now rushing to follow this good gesture.
Over the weekend, we heard that the island’s largest quoted supermarket group, Orphanides has also promised to also round-down euro prices, which combined by similar reports that the Supermarkets Association members are also likely to follow suit, means that a major chunk of the retail trade is promising to restrict rounding-up prices and to pursue fair invoicing.
We expect other big ticket retailers, car dealers and establishments to follow suit. Before long, the euro rounding-down will become such a common feature that soon, the public will lose interest in the whole exercise as we will expect other major services companies to come forward, mimicking the Shacolas gesture.
Before everybody starts to congratulate each other for a wonderful way with which things have been sorted out, we beg to bring to the attention of the authorities the current wave of price hikes working their way in the retail market.
You guessed right. Since many businesses know too well that their pricing and conversion policy will be under close scrutiny, many have started hiking prices from now, so that when January 1, 2008 comes, there will be no need to round-up prices and risk being accused of ripping-off the public, and instead, they too will join the big retailers in claiming that they are rounding-down prices.
We are already hearing multiple price hikes on many small item consumer goods starting from chewing gums to ice cream and at this rate, things are likely to get out of hand, as everybody rushes to hike prices before “E†Day.
In our opinion, before the euro rounding-down exercise and pledges gets out of hand and turns into a fiasco as everybody jumps to join the “be nice†bandwagon, the Ministry of Finance should state that the pricing pledge should be made on the average prices prevailing, say, six months before the introduction of the euro.
We understand that the Euro Observers will not have the time, resources and expertise to check the average price of every item sold by a retail establishment during the six months prior to the introduction of the euro, but the Finance Ministry can call on the help of thousands of citizens to monitor prices on a voluntary basis.
And by asking companies to give their pledges of rounding-down prices from the average price sold six months prior to euro introduction, the number of companies likely to make such pledges will drop and the whole exercise will not turn into a fiasco.
But more importantly, the government will send a message to the public that it will not allow for price increases to be built up before the euro makes its debut and then join in the mockery of telling the public that 99% of business establishments in
