Filipino consumers at the local level were still plagued by high prices, as the year-on-year inflation rate for food items, excluding beverages, sold in sari-sari stores reached 15.62 percent in January, according to the latest research released by Packworks in collaboration with Fourthwall, a sociocultural research firm.
The figures obtained from Packworks’ Sari IQ business intelligence tool show sari-sari store’s inflation rate was 4.4 percent greater than the official food inflation of 11.2 percent reported by the Philippine Statistics Authority in January.
The inflation of ready-made food (16.9 percent) recorded the highest difference with the official statistics (9.2 percent), exceeding PSA’s data by 7.7 percent. This is followed by milk, dairy, and egg products and cereals, with a difference of 5.3 percent.
Fourth Wall and Packworks replicated the consumer price index approach used by the Philippine Statistics Authority, applying it to the products available in Sari IQ’s data. The products included per category are only those that are available in sari-sari stores.
The higher sari-sari store level inflation rate could be indicative of the increasing pressure among sari-sari store owners to increase their mark-ups and profit margins, according to the study.
These pressures come from continuing supply-side challenges, such as the shortage of eggs due to bird flu, thus, explaining the high discrepancy between dairy and egg products.
“It is important for Filipino consumers to be aware of these discrepancies because the products [ready-to-eat food, egg] whose inflation rate at the sari-sari store exceeds that of PSA are also the ones that the lower class typically consume due to their association with convenience and cheap price,” said Fourth Wall research director John Brylle Bae.
“In a socio-cultural context, we tend to measure how well off or worse off we are through inflation – that is, inflation is the primary metric of poverty and economic performance, which becomes even more relevant if what is being discussed is food. This reminds us of the usual lamentation of older Filipinos, ‘noong araw, mura pa ang galunggong…’ which means we are economically worse off now,” he said.
Andres Montiel, head of data at Packworks, said “official statistics are limited in capturing grassroots patterns, which makes it crucial to cross-check them with data at the sari-sari store level to obtain a more precise understanding of micro-level dynamics.”
“At Packworks, we provide retailers with reliable data that can be utilized to enhance customer engagement. Sari IQ is instrumental in uncovering what is happening at the ground level,” Montiel said.