Thursday, July 17, 2008 Retail chain trims costs to make prices affordable to entrepreneurs
EVEN when all of its suppliers have raised prices, a local warehouse club chain said it will maintain its niche by having the cheapest complete merchandise in the province.
Robert Go, owner of four Prince Warehouse Club outlets in Cebu, said the company will continue to maintain its low overhead cost so that it can continue serving its customers, who are mainly “sari-sari” store owners.
Go, however, admitted that Prince Warehouse increased prices of various products. But he assured that the increase was “very minimal.”
“If our suppliers have increased prices by 10 percent, we only increased by five percent,” he said. He said the company puts a limit to its profit to retain its customers.
To be able to sell goods at low prices without jeopardizing its profit margin, Go said Prince Warehouse does not buy products through middlemen, but go directly to producers. The company also imports directly.
But the current “economic crunch” has resulted in a decline in the number of customers at Prince Warehouse, particularly at its North Reclamation Area branch, Go said.
“Convenience now plays a part (in the customer’s decision to shop),” he said, adding that because of the increase in jeepney fares, people would rather go to stores near them.
He also noted a change in people’s buying habits. He said people buy fewer appliances or furniture and give priority to essential goods, instead, like food.
As a gesture of goodwill to its loyal customers, Prince Warehouse will hold a Sari-sari Store Festival on July 25 at the Cebu International Convention Center. The one-day event is expected to gather 1,600 sari-sari store owners who are club members of Prince Warehouse’s Sari-sari Store Society (SSS), said Rhea Go, chief operating officer.
Now on its third year, the program will include a seminar on basic accounting, inventory management and how to gain
access to micro-finance institutions.
The activity, anchored on the company’s corporate social responsibility initiatives, is also meant to create livelihood opportunities for the people.
During the Sari-sari Store Festival, Prince Warehouse will also award its top SSS club members.
An SSS club member is entitled to 0.05 percent rebates in the form of gift certificates once the member’s accumulated purchases reach P50,000.
Aside from the sari-sari store owners, Rhea said the company also has institutional customers, like canteen
concessionaires of schools and private companies, as well as hotels and restaurants.
Rhea said 95 percent of restaurants in the city are customers of Prince Warehouse because the store has a complete line of kitchen and dining products.
Prince Warehouse also has outlets in Ormoc, Bohol, Samar and Leyte.
Although the company does not have immediate plans to open additional branches, Robert said one of Prince Warehouse’s vision is to go to other parts of the country. (DME)
