Weve always prided ourselves on sourcing quality ingredients, many sourced locally, and offering these at reasonable plate prices. Our coffee, the excellent Genovese, is sold slightly below the industry average at $3.30. Will we still be able to do this after the Carbon Tax is introduced?
As a small business owner who is still establishing themselves, this is a fairly uncertain time, and there is a dearth of quality information at the moment. The hardest thing is sorting out the political jargon and vote winning scaremongering (Thanks Tony!) from the sensible debate. What I can tell you is that there is a $1.1 million fine for increasing my prices by more than 0.7% due to the effects of the carbon tax! Ouch!
Kenton Campbell of Zarraffas Coffee has written about the effect on his business being between 5 cents and 25 cents (depending on the article you read) (You can link to what ive found from the bottom of this page). This seems at the lower end of the scale to be honest.
A short summary of predicted increases reads like: Food and Groceries up 5%; Electricity up 10%; Gas up 9%. Combine this with coffee bean prices doubling over the past 12 months and currently trading at their peak price in 30 years, the recent changes to penalty rates for employees, the inevitable increase in Coucil charges, and 0.7% doesnt look like much! It'll really hurt when the Council increases their charges due to the carbon tax!
Im not really buying in to the hype and politics of this issue. Id just like to be able to plan with a bit of confidence for the next twelve months, and beyond. What really got me in the letter to the editor (wish I could remember who wrote it!) was the link between the closure of the Heinz processing plant and the increase in tomato prices. How do they link? Obviously really. With no Heinz to supply, we lost some of our largest tomato growing families. The immediate result is a shortage of tomatoes and sky high prices (Close to $1 each). The long term result is we lose generations of knowledge. Even in this Google generation its hard to gain experience quickly! If electricity and gas increase by a combined 19% then surely its inevitable more processing plants will close and the effect will domino through many sectors of our farming industry. The outcome of this would be similar sudden steep increases across the board, or more imports?
So what have I learned? Honestly? Im still pretty lost! I remember similar dire predictions before the GST was introduced and the industry survived. And what of the effect of the carbon tax on Lady Marmalade Cafe? Looks like a game of wait and see, or to be continued!
Id love some feedback from what anyone else thinks, or predicts.
Mal Gill
Lady Marmalade Cafe
For your interest:
Australian Food and Grocery Council predicts up to 5% rise in Grocery prices
Zarraffas Coffee chain talks about increased costs to Landlords being passed on to tennants
Tony Abbott with Kenton Campbell (Zarraffas) discussing price rise of 25c per cup
Phillip DiBella and others discuss rises in coffee bean prices (mostly pre -Carbon Tax rise talk though)
Coffee bean prices are currently at 30 year highs
Electricity up 10% Gas up 9%
Fines for increasing prices by more tham 0.7 per cent
"As if that were not enough, the government's miserly carrots will be coupled with a big stick: a $1.1m fine for any small business assessed by the Australian Competition and Consumer Commission to be increasing prices by more than 0.7 per cent."
www.ladymarmaladecafe.com.au
www.ladymarmaladecafe.com.au
