asked the Minister for Industry and Commerce if he will give an indication as to how retailers' and wholesalers' percentage margins have fared in the inflationary period over the past year.
Ceisteanna—Questions. Oral Answers. - Retailers' and Wholesalers' Margins.
19.
The Prices (Stabilisation of Profit Margins of Importers and Wholesalers) Order, 1973, and the Prices (Stabilisation of Profit Margins of Retailers) Order, 1973, which were introduced by me in June, 1973, operated to freeze at the levels which obtained on 23rd June last the cash margins which may be taken by importers, wholesalers and retailers on a number of commodities. These two orders were necessary because a feature of trading at the import, wholesale and retail level had been the adding on of a customary percentage mark-up on cost prices. This practice, taken in conjunction with inflationary trends over a number of years, resulted generally in an increase in absolute cash margins to traders out of proportion to increases in their labour and overhead costs. The orders mentioned were intended as a corrective to that situation. The percentage margins of retailers and wholesalers will of course vary with the changes in cost prices, and in the absence of a detailed investigation, I cannot say how the percentage margins of these traders have been affected by the orders.
Is the percentage margins allowed to rise with the increase in costs. It is not fixed at a particular sum? Is the percentage the same irrespective of the increase in price?
No. The percentage margin is the actual profit. The actual margin on the 23rd of June is fixed. But in the case of an imported article, for example, as the phased price of the imported article rises the percentage margin diminishes. Since the actual real margin in pounds and pennies is frozen, the percentage margin diminishes. Indeed, from the protests I have been having from a large number of bodies it is indicated that this is happening and that we are squeezing margins, although I cannot give the Deputy an accurate answer as to how much.