The closure of the state project "Shops for People" shows that administratively limiting costs and prices cannot work in the long term, Nikolay Valkanov, executive director of the Association for Modern Trade, told BTV.
“With administratively set cost limits, no business model can survive. Sooner or later it breaks“, he emphasized.
According to him, such initiatives have difficulty achieving sustainability, especially if quick results are expected.
“It is impossible to cover the costs of a business operator within such limits. Every such attempt ends the same way“, said Valkanov.
He added that the assessment of the specific decision is within the powers of the principal, but is probably based on the real financial results.
Valkanov explained that administrative measures can have the opposite effect.
“The most reasonable thing is to help vulnerable groups. Everything else - price ceilings, profits or costs – harms the market“, he also said.
He warned that such interventions could lead to shortages of goods and distortion of competition.
Regarding accusations of speculation by traders, Valkanov noted that the legislation is already synchronized with European rules.
However, he warned that the new regulations carry a risk: “There is a general prohibition that can be interpreted very broadly and lead to arbitrariness on the part of the regulator.“
Despite the growth of wages, the sector is experiencing a serious shortage of personnel.
“Literally every business has to “steal“ employees to remain competitive“, said Valkanov.
Data shows that salaries in modern trade have increased by over 60% in 5 years, the average gross salary is about 440 euros, the time to find an employee has reached 6.5 weeks, he summarized.