DeCourcey Eversley, Director of Fair Competition at the Fair Trading Commission (FTC) believes that consumers need to be armed with a better understanding of excessive pricing and also that it takes time to investigate claims of excessive pricing.
Price Gouging and excessive pricing have been the topic of the last few months and many different interest groups are weighing in on this pressing issue in Barbados arguing that the cost of goods are too high. The FTC official believes the term price gouging is being loosely used in Barbados and this needs to be addressed.
He pointed out at a Small Business Association meeting last week at Bagnall’s Point, Pelican Village that while Price Gouging legislation has been debated, it has not been passed. “However, in the Fair Competition Act, there is provision which deals with excessive pricing,” he said.
“Excessive pricing has to do with a company that is dominant in the market and it does not mean that if an average supermarket has the price of ketchup, for instance, a lot higher that you anticipate it to be excessively priced. Excessive pricing has to be a company that is deemed to be dominant and that means you are like a monopoly, therefore every store you think that the price is too high cannot be investigated for excessive pricing,” said Eversley.
He pointed out that the companies that can be investigated by the FTC for excessive pricing would include the Flour Mill, Feed Mill, basically whoever in the market place that has dominance, since you are in the market operating without effective competition.
He argued that competition is supposed to regulate prices. “In the USA they don’t have issues of price gouging and excessive pricing. In Barbados, we have limited competition, we are a small market and depend heavily on imports. We can talk about excessive pricing but we need to bring understanding of the issues, we can’t get a positive solution if we don’t approach it correctly,” according to him.
Eversley stated that in Barbados most of the markets are dominated by monopoly or oligopoly. There is not a huge amount of competition, he noted and said that the rise of commodity prices , fuel and energy, are among factors contributing to higher prices.
Local consumers have complained that the FTC is not moving assiduously to deal with these matters of excessive pricing in Barbados. To this, Eversley said that while they have investigated many companies it is ongoing process.
He explained, “We investigated Barbados Flour Mill and Pinnacle Feed. At Pinnacle at the time of that study it was revealed they were excessive, they had a pricing system when cost were coming down they were not passing this on to the consumer we worked with them , they had to go back and redo pricing model.”
As to the Flour Mill, he recalled that in 2008 the FTC determined that when the cost of wheat was going down they were not passing that decrease. “We worked with them and they had two decreases in price around that time,” he said.
The Commission is always monitoring the market whether or not there is excessive pricing.
“We have to do thorough investigation as every company values their reputation. It may seem long to Barbadians but you cannot demand changes without the adequate research and proof,” he declared.
“The consumer represents the biggest competition which can drive prices down , at the same time consumers represent the ability to move and shop and put pressures on other companies. They are products priced high and demand still going up. If you go to an alternative brand the company has to find a way of regaining market share,” he added.
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