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Retailers to suffer
brunt of penny drop Local stores making price adjustments in preparation for loss of one-cent coinSimon Whitehouse Northern News Services Published Wednesday, April 11, 2012
Federal Finance Minister Jim Flaherty announced during the March 29 budget that the one-cent coin will soon be phased out. National media reports have suggested that this will save the government $11 million because it costs about 1.6 cents to produce one coin. Yellowknifer contacted a number of local establishments to see how the announcement would impact their operations. Kentucky Fried Chicken store manager Sasha Jason said her restaurant sees a high volume of pennies and that she goes through about 50 to 75 paper rolls of the coins per week. Because the restaurant uses more pennies than any other type of change, she says she anticipates having to make major changes to the price lists in the very near future. "Basically everything is going to need to be adjusted, but it is going to take some work to figure out with the GST what the final prices will be," she said, noting that there will be changes to both the menu board and the till. "We are definitely going to have to start preparing for it right away just because we have to get in touch with the people who program all of our tills and get them to update it. It isn't something that we do ourselves. So there is a waiting period on that to make sure it all gets done in time. So I guess in preparation for not having the pennies, it has to be done pretty quick." Other proprietors in town have already done the work after hearing the announcement on the news following the federal budget. "We have started to change our pricing already," said Village Reddi Mart store owner Jason Cooper. "If our price was $3.96 or something, we would take it down to $3.95. If it was $3.98, we would take it up to four bucks. We try to keep it at $3.95 and we don't like having them doing round numbers because it is a bit of a psyche for people." Cooper says the task takes about three or four full days. "It is definitely a couple of full days to go through our whole stock," he said. "The holiday here was pretty quiet, so I spent a good three or four hours going through all of the drinks and we have gone section by section." Cooper said he didn't think the demise of the penny would mean a loss of revenue because his adjustment of the prices would all balance out through rounding up or down on the cost of items. He said he was not aware of a time period in which he could not longer use the penny, but decided to tackle the job after the news announcement so that he was ready for the summer when he sees more business activity. Still other businesses may be in fact celebrating the cancellation. Black Knight Pub assistant manager Jennifer Pike says she will not miss the little copper coin. "Honestly, I love that they're getting rid of it," she said. "In a business like this I don't know why the lowest coin that we have isn't quarters." Pike says that with people making Visa and other card payments, it also won't make much of a difference. "If you came in and had a bill of, say, $32.32, I would probably just give you back 75 cents," she said, adding that the pub is lucky if it even goes through a roll of pennies in a week. Yellowknife Chamber of Commerce executive director Tim Doyle said ultimately there probably won't be much concern among most of the population, but noted consumers could be hit slightly at the gas pumps. "There has been a little bit of concern from some of the smaller businesses just in terms of costs," he said. "More specifically, some people are a little concerned about how it is going to impact gas prices - where those are measured not only in pennies, but also decimals of pennies." He noted that if fuel prices, which are already rising, are being rounded up, people might notice the increase on monthly home heating bills.
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