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Chain store 'bargains' in fact dearer

Cheung Kong
Amy Nip

The city's dominant supermarket chains are cheating consumers by raising the prices of items before offering discounts, making them more expensive than before the increase, a Consumer Council survey shows.

It also found prices were generally highest on Fridays - when ParknShop and Wellcome flood newspapers with advertising for bargains.

A council survey tracked prices of 288 items sold by the two chains between October last year and February. Some goods, even when tagged with promotion labels, were sold at higher prices during the bargain period. The survey found 79 such instances of the practice.

In one such case, both supermarket chains raised the price of a can of beer from HK$5.90 to HK$6.10 on November 14, and further to HK$6.50 the next day. Later on the same day, one company offered a promotion of HK$12.30 for two cans of beer. The other chain followed suit a day after, on November 16.

The promotional unit price of HK$6.15 - at HK$12.30 for two - was actually 4.2 per cent higher than the HK$5.90 price before the increases on November 14 and 15, just before the promotion.

Ambrose Ho, the council's vice-chairman and also the chairman of its publicity and community relations committee, noted that in Australia, a Trade Practices Act defined 'discount' and 'discounted price', ensuring that the promotional price would be lower than its regular price. 'There are no such laws in Hong Kong,' he said. 'We hope that the government will regulate the business practice with guidelines or legislation.'

The council filed a proposal for such a legislation last year and is waiting for government action.

Its findings contradicted the common belief that supermarkets offered bargains over the weekend, the watchdog said.

Some 207 items in ParknShop - or 71.9 per cent - were most expensive on Fridays, while 158 items in Wellcome - or 54.9 per cent - cost the most on the day. The finding was based on the average price of the same item on the 21 Fridays in the survey period.

Most items were cheapest on Thursdays - 52.4 per cent of them in ParknShop and 47.6 per cent in Wellcome.

Mr Ho urged consumers to be more alert. 'People should be smart consumers when they visit supermarkets,' he said. 'They should observe the prices during the week and decide whether the goods are really cheaper during weekends.'

In response to the survey, ParknShop said the sample size of 288 might not be representative, as it sold more than 30,000 products. Wellcome said that it posted its prices on its website.

Both companies said their prices were subject to variations in cost and competition, and pointed out that they offered non-cash concessions such as Octopus Card rewards.

The survey also found 'price copying' in 55 of 375 items sold in ParknShop and Wellcome.

The practice was most common among baked goods, and least common among household products and staple food.

The prices of 200 top-selling items in supermarkets rose by an average of 12.6 per cent last year.

Prices of staple foods rose the most, by an average of 34.9 per cent. A brand of corn oil went up 77.2 per cent. Prices of canned food and prepackaged soup saw the second-biggest increase last year, at 21.9 per cent on average. Alcoholic drinks were the only category where prices fell.