Bottled drinks to cost a bit more

Come November 1, Barbadians can expect to pay slightly more for drinks bottled by the Barbados Bottling Company (BBC).

In a memo dated October 1, 2021, the island’s largest bottling company served notice to its retail partners of a four per cent increase in its products from the start of next month.

“This marginal increase equates to an average of $0.08 per unit, depending on the package size,” it said, adding that there would be “a similar four per cent price increase on our BIB (bag in box) package options”.

BBC, which is part of the Banks Holdings Ltd. Group (BHL), is the local franchise holder for several popular brands, including Coca Cola, Sprite, Fanta, Powerade and Frutee.

The soft drinks manufacturer said it has been significantly impacted by the ongoing increases in the global supply chain.

General Manager of BBC Andre Thomas told Barbados TODAY the supply disruption, which has resulted in increased freight costs and, by extension, increases in commodity prices, has highlighted the importance of local manufacturing.

“This is a good example of why local manufacturing is critical. Imagine if we don’t control any of those resources and we just have to rely on somebody from somewhere else manufacturing things and we are just importing them,” he pointed out.

“It is necessary for Government to really put policies in place to not only preserve and encourage, but also help local manufacturing to grow and prosper.”

Barbados imports the majority of its raw materials, especially from extra-regional markets.

Earlier this year, when several ports around the world started reporting a backup of container ships due to a surge in panic-buying brought on by the COVID-19 pandemic, freight costs and overall commodity prices began rising sharply.

By the middle of the year one of the region’s largest conglomerates, GraceKennedy Ltd. reported that freight out of China had increased from a pre-COVID-19 rate of about US$2,500 per 20ft container to US$15,000 per 20ft container, as at June 17.

This was then echoed among the local business community, which reportedly witnessed similar price increases of more than 400 per cent.

Explaining the increase in BBC’s bottled products, Thomas told Barbados TODAY it was solely due to the significant increases that were resulting from freight costs being passed on to the company.

He said BBC had been able to make changes to its operation to lower costs, but it was proving to be extremely difficult.

“We had scenarios where freight companies that were shipping on a weekly basis indicated to us that they are now shifting to every other week, and the prices of some ingredients have gone up, nearly doubled. So we try to maintain our pricing for as long as possible, but everything has really gone haywire,” said Thomas.

He stayed away from predicting any further increases in the drink products in the near future, even as ships continued to be backed up in ports.

“You can’t predict what is going to happen in these crazy times, but we try to be as efficient as possible and try to manage. We have kept our staff safe and we have not had to really lay off people. We kept our staff fairly whole throughout the year. We did have to go from three shifts to two, but those persons who are still working work a full shift every day. So we have had to make some significant adjustments,” he said.

(marlonmadden@barbadostoday.bb)