Consumers want the prices of choice products untouched

As fast moving consumer goods (FMCG) firms continue to adjust to inflationary pressures, a majority of consumers say they want the prices of their favourite products untouched, according to a new survey by BusinessDay.

91 percent of consumers say they would prefer a reduction in the size of the products rather than an increase in price.

‘‘Let the price remain the same. My stomach can hardly tell the difference in size reduction but my pocket won’t miss the increased price,’’ said Onyedikachi Analaba, an engineer who resides in Owerri, the Imo state capital.

Nnenna Njoku, an Abuja-based banker said: ‘‘The economic crisis has negatively affected consumers spending power. Price increase will scare people like me away.’’

Less than eight percent of the consumers don’t mind if they producers decide to hike prices as long as they don’t compromise on quality.

‘‘If the quality of the product is not tampered and the cost of production is on the increase, the manufacturer can increase the price,’’ said John Okoro, a resident in Lagos.

Some of the FMCG firms that have cut down on size of their products include Coca Cola Nigeria Limited, 7up Bottling Company, UAC, CHI Limited and Rite Foods Limited.

Coca Cola Nigeria Limited and 7up Bottling Company reduced the quantity of all their pet bottles by 16.6 percent from 60cl to 50cl while UAC, CHI Limited and Rite Food reduced the sizes of their sausage rolls.

‘‘This economic recession has affected us in so many ways especially with profitability. Cost of production has gone up. Our N50 gala is now smaller because consumers say they must pay N50. To remain in the market, we had to reduce the size of our sausage roll but we have a N100 gala for those who could afford it,’’ said Joan Ihekwaba, general marketing manager, UAC Foods Limited.

Inflation rose in September to a record high of 17.9 percent, the highest since October 2005, as food, electricity and other energy costs drove up prices in the country.

The inflation rate rose to 17.9 per cent from 17.6 per cent in August, the National Bureau of Statistics (NBS) said on October 14.

‘‘We only increased the carton price of our noodles by N200 based on the inflationary rate and economic situation. The pressure on us is huge; cost of production has gone up. A lot of industries have closed down. If we didn’t take that increment, we will shut down as well,’’ Tope Ashiwaju, Group Public Relations and Events Manager, Dufil Prima Foods Plc. told BusinessDay.

BusinessDay findings revealed that Beloxxi industries Limited have reduced the number of sticks in a pack of Beloxxi crackers biscuit to two from four for the same price of N10.

Also, Pardee Foods Nigeria Limited cut down on the amount of sticks in a pack of Parle-G glucose biscuit to nine from 12 but for same price of N10.

However, the price of Newbisco coasters biscuits went up to N15 from N10 and the number of sticks in a pack is now four instead of five.

‘‘I used to eat Newbisco coasters biscuit a whole lot when it was N10. Then, it was five pieces in a pack but I stopped buying it when the price went up to N15. It seems more logical and economical to reduce size instead of increasing price,’’ Edozie Umejih, a staff of Jophyl Energy, an oil and gas firm in Lagos said.

Other fast moving consumer goods like food and beverages, detergents and soaps, have also had their prices increased markedly in the past one month.

‘‘We do not want to jack up the price of our products so much because of the economic situation. We only reduced our 50g digestive biscuit to 48g at the same price and added N50 to the price of our detergents,’ said Tiwalade Fatungase, south/west marketing supervisor at Nasco Foods Nigeria.