Increase in petrol sales commission or increase in good’s price?

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KUALA LUMPUR  –  Petrol Dealers Association of Malaysia (PDAM) president Datuk Hashim Othman says petrol station owners may have to increase the prices of goods sold in their convenient stores if the government ignores their request to increase petrol sales commission.

According to the Malaysian Digest, the warning comes ahead of the implementation of the mandatory minimum wage tomorrow, which will increase petrol stations’ operating costs.

Hashim said a memorandum on the request to increase dealers’ commission was submitted to the Domestic Trade, Cooperatives and Consumerism Ministry last month, and he hoped the government would respond positively within three months, Sin Chew Daily reported today.

“Petrol station operators are considering increasing the prices of goods in their convenient stores for a number of reasons.

“Apart from the commission, other factors include the issue of wholesale prices. If the wholesalers hike their prices in the face of the minimum wage policy, we will have to increase the retail prices accordingly. This is a chain reaction,” he said.

He told the daily that the association had days ago indicated that the implementation of the minimum wage at the start of the new year would result in a 30-40% rise in operating costs for petrol stations.

“To offset the hike in operating costs, the association has urged some 50% of its members who have yet to implement the self-service system to do so to reduce dependency on foreign workers,” he said.

He said its members hired some 50,000 workers of which 10,000 are foreign workers.

“Once all our members implement self-service at the pump, our dependency on foreign workers will be cut by half.”

Following the last revision in 2008, operators receive a commission of 12.19 sen per litre for petrol and seven sen per litre for diesel, an increase of 2.69 sen and 2.5 sen respectively from previous rates. Hashim, however, declined to reveal the quantum of increase the operators are seeking this time around.