Price surge puts pressure on local businesses

June 01, 2022 - 10:34

Increasing oil prices have led to a surge in the costs of food and other essential items, causing a significant impact on local people and businesses..

Small restaurants in Hà Nội and HCM City were forced to raise their pricing due to the price surge. — VNA/VNS Photo 

HÀ NỘI — Increasing oil prices have led to a surge in the costs of food and other essential items, causing a significant impact on local people and businesses.

Under immense pressure, several small restaurants in Hà Nội and HCM City have had to raise their prices. 

Duyên’s crab noodle shop has kept its pricing stable at VNĐ30,000 (US$1.3) per bowl for years. However, the surge in food prices since March has forced her to increase the price by VNĐ5,000 (US$0.22) per serving. 

Duyên said: “We mostly serve local residents and workers, so I tried to keep the price the same for as long as I could, but now it is impossible.

“Prices will probably continue to increase if the costs for ingredients and gas remain this high.”

In a Huế-style beef noodle restaurant on Trần Khát Chân Street in the capital city, prices have also increased by around 15 per cent, compared to last year. 

Hoàng Cường, the restaurant owner said: “Surging food costs forced us to increase the prices, in order to avoid making a loss.”

Except for the price of meat, which is still relatively stable, noodles, cooking oil, spices, and gas bottles all witnessed a hike in prices, said Cường.

He added: “To inform the customers and not blindside them, we put up a notice in front of the store and ask for their understanding.”

Meanwhile, in HCM City, restaurant owners are struggling to keep their pricing the same for fear of losing customers. 

Thanh, the owner of a shop specialising in duck meat dishes on Trường Sa Street, District 3, HCM City, said the meat price had increased by VNĐ8,000 per kilo. Her restaurant processed about 50 to 70 kilos of duck meat every day. 

Thanh told Thanh Niên (Youth) newspaper: “Spices, cooking oil, sauces, gas bottles have all become expensive like never before. 

“Our daily cost has increased by VNĐ600,000 to VNĐ700,000 (US$25 to US$30), compared to the period before the oil price surge. It is terrible!”

Since the beginning of the year, the restaurant has never increased its pricing. However, the number of guests has dropped significantly, around 30 to 40 per cent less.

Thanh noticed that now people are more cautious with their spending. The fluctuating weather is also a factor in the shop’s declining revenue. 

At this point, she is just trying her best to maintain the restaurant and the relationship with regular customers.

Thanh said: “Before the pandemic, I had five locations in total. We had a reputation here in HCM City. But now after the pandemic, there’s only this one shop left to continue.

“I hope that the price surge will soon pass so that I can start over, this is my life’s work. 

“As for the pricing, we will probably keep it that way, until we can no longer bear it then maybe we will increase it a little. Now if we can’t stand the weather, we will easily fall into debt.”

On Phạm Đình Toái Street in the same district, Đỗ Bá Thiêng’s restaurant is bustling with customers. The shop decided to increase its prices by a few thousand đồng over a month ago.

“Now as fuel prices hike continuously, our costs also rise along, but how can we keep increasing our price tags? Now we can only try to bear it and balance everything”, said Thiêng.

The restaurant’s costs have increased by 20 per cent, especially as it offers free delivery service. 

Thiêng added: “We can only keep hanging in there, accepting that our profit will decrease a little and sharing the burden with our customers to overcome this situation.” — VNS