Cost of croissant at Thomas Haas up from $3.40 to $3.80, which still doesn't cover costs, says confectioner
Thomas Haas has never seen food prices quite so high in his over-40-year career.
"We calculated and [the price increase of our ingredients] was between 28 per cent, the lowest, up to 71 per cent, the highest, in one year," said the founder of Thomas Haas Fine Chocolates in Vancouver.
He adds they've seen price increases of over 30 per cent for dairy ingredients, chocolate, and fruits last year, and a 71-per-cent price increase in eggs at one point due to the avian flu.
This week, he says, they estimate an average 20-per-cent hike in ingredient costs.
Haas is one of several bakers in Vancouver reporting a yearly rise of 30 to 40 per cent in costs since the pandemic started — a large difference compared to previous years, says Haas.
Thomas Haas is pictured in his kitchen in a black bakers outfit.
Now they're speaking out in hopes of drawing attention to the issue and to let customers know what's behind the price increases.
Over the past few weeks, Haas publicly shared his frustration on Instagram.
"[Cost and price increases] will just affect everyone and especially the [customers] we value greatly."
Cutting profits, saving costs
Sergio Salamonovitz, pastry chef and co-owner of Trafiq Cafe and Bakery in Vancouver's Riley Park neighourhood, says increases have been "steeper than [he's] ever seen" despite being in the industry since 1999.
"It doesn't make it easy for us or obviously our margins are small as it is," he said, adding Trafiq has taken a different approach to the issue: cutting their profits instead of increasing prices.
He says the majority of Trafiq's customers are regulars from the neighbourhood
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"Because of the economic challenges we're all facing, we want to be a place that people didn't feel like they were being pushed into purchasing something for more," said Salamonovitz.
"We're not here for one year, we're hoping to be here for another 20 years," he added.
"So not every year needs to be the most profitable."
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Haas says he's tried not to raise prices, but items like a standard croissant has gone up from $3.40 to $3.80 recently — which still isn't enough to cover the jump in costs.
"It's an [11-per-cent price] increase while our ingredients have gone up 27 per cent on average," he said, adding they've re-organised production processes to be more efficient and to save on costs.
'A new way of operating'
Haas says he feels the continual rise in costs is due to a lack of competition between suppliers.
He adds that "once [prices] go up, they never come down even though everything else has settled."
James Vercammen, a food and resource economist at the University of British Columbia, agrees the increases are likely due to decisions throughout the transaction process.
Three bakers are busy working in the kitchen. One in the foreground is filling moulds with chocolate.
Bakers at Thomas Haas work in the kitchen. (Justine Boulin/CBC)
"You have wholesalers, retailers, and big food manufacturers, and it seems like they're all taking maybe a bigger slice of the pie than they have in the past," said Vercammen.
He says once inflation hits and costs start rising, suppliers start getting used to high prices.
"It's like we're in a new way of operating and it's hard to get back to the old way again, because [companies] don't want to get left behind," he said.
"We shouldn't hope for a recession … [but] the Bank of Canada has been telling us all along we might need something that's severe if we really want to get inflation down quickly."
Vercammen explains that while the high prices will go down in a recession, the risks to other aspects like employment outweigh the benefits.
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He adds that in 2004, the price of flour was about the same as it is today, but those prices went down naturally in a slow, gradual decline.
"I don't know whether we'll see a decrease [in prices soon]. We simply can hope for reduced pressure [to commodity markets]."
In the meantime, Haas says he'll continue to speak out on the issue, which he worries will affect his customers.
"We're working hard to make sure that increases are minimally affecting those customers."
Source: https://www.cbc.ca/news/canada/british-columbia/bakery-increased-costs-1.6751674
