PriceSmart focussing on quantity, size and price
In an exclusive with Barbados TODAY this week, Country Manager Benjamin Woods who flew in for just two days at the Green Hill, St. Michael outlet, said that the membership club did sell local produce and products.
He explained though that the club’s mantra was to “leverage” items at the lowest price, in large quantities oftentimes simultaneously for all the outlets of the region and then be able to pass savings on to the members.
Any item purchase locally “has to fit the club format”, he explained.
“We sell in large pack sizes, we sell in multi-pack sizes. We don’t sell in single units. The reason for that is that by buying in larger pack sizes, let’s take cornflakes for example, it allows you to leverage the unit pricing and get lower unit pricing. We have to be able to show that value in the unit pricing and extend it back to our members.
“So the items that we purchase have to fit the multi-club pack type format, that’s the first thing. The second thing then is we look at what is the best value for the member. The best value for the member most times is to purchase the item locally, but sometimes it’s not. It just depends on the category or … the item. Our job is the lowest possible price and that comes first. So whether that means that we purchase it locally or we purchase it imported, as you know there is a lot of cost structures that goes into what the final price is going to be for an item. “Sometimes it makes all the sense in the world to buy the item locally, because by the time you import it, you pay the taxes locally, you pay the duties, and it’s priced out of the market. It just depends on what the item is,” he said.
Local items to be found on the shelves include some vegetables and fresh herbs, some meats, most sodas, Wibisco products, some spices, to name a few.
Woods said though that chances were slim that Barbadians would find local non-food items on the shelves, for the same reasons of leveraging and pricing.
“We purchase all of our non-food items for all of our locations at one time. It is difficult for us to purchase non-food items locally because again it is all about the leverage that we are able to offer by buying in those high volumes and buying multiple container loads of the same items, that allows us to push back the lowest possible price to our members.
“It boils down to the lowest possible price at the lowest possible acquisition cost, respect the value of the membership, what’s the most amount of volume we can sell and not what’s the most we can sell it for,” he stated. (LB)