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Moon cakes selling slowly, producers weeping
Moon cake producers are now like cats on hot bricks as cakes have been selling very slowly, while the moon cake sales season will conclude in another week.
The owner of a moon cake workshop in district 5, HCM City, showing reporters a room full of moon cakes, said that only 50% of cakes have been sold so far.
“We will surely incur a loss this season. We have never before met such slow sales,” he said.
As slow as the sale of moon cakes
Other moon cake producers also complain that they cannot sell cakes, saying that the number of orders from enterprises and factories in industrial zones and export processing zones this year has decreased dramatically from previous years.
“We lost big orders this year,” said Lai Hoai Phuong, the owner of Dong Hung Vien moon cake trademark, a trademark well known to the Chinese community in HCM City for 50 years.
Phuong said that in previous years, a lot of orders began coming in late August. Enterprises purchased cakes to give to their staffs and partners as gifts. However, these enterprises did not place big orders this year, which spells that Phuong’s workshop’s turnover has decreased dramatically since wholesale makes up 50-70% of her total sales.
The owners of other cake workshops in HCM City also say that they are now focusing on retail rather than wholesale.
Nguyen Quoc Hien, Deputy General Director of Cho Lon Service and Trade Company, which owns Ai Hue moon cake trademark, said that 2008 is turning out to be the most difficult year in the 50-year history of the trademark.
Hien said that high inflation has forced people to tighten their belts, which explains why the cake purchasing power is much lower than in previous years. Enterprises are not placing big orders this year because they are trying to cut expenses in the face of commodity price increases.
Both Hien and Phuong believe that the majority of the moon cakes sold have been used as gifts, while the real demand for eating is very low.
Some small moon cake producers have additional complaints. Small violations of the workshops have been exaggerated, resulting in partners cancelling orders with them.
Inspectors from the HCM City Health Department found out that D. Company did not have all its staffs’ health examined, but a newspaper reported that the company used Sodium Hydrosulphite, a toxic substance sometimes used in making cakes.
“The newspaper then had to correct its mistake, but it was too late. Orders had fallen into the hands of other workshops before the correction was made,” said the owner of D. Company.
There have been insinuations that “unhealthy competition” is behind such instances.
A representative of another company complained that the company was imputed as using materials with unclear origins just because it could not show a receipt for materials to inspectors.
“The problem is that the material supplier only issues bills 3-5 days after the delivery dates,” the representative said.
Cake producers try to save themselves
Phuong, the owner of Dong Hung Vien trademark, said that the company, anticipating the difficulties, has been trying to diversify products in order to attract clients.
“We have launched new products with new kinds of stuffing, like kiwi, pineapple, grapes and durian, which we hope will fit the tastes of many people,” Phuong said.
He added that the cakes with fruit stuffing cannot be preserved for a long time. However, Phuong hopes new products will help boost sales.
Meanwhile, Ai Hue has been trying to attract more customers with promotion programmes. Those who purchase Ai Hue moon cakes have the opportunity to join lucky draws to get valuable things like TV sets, refrigerators and washing machines.
Several hotels and restaurants have announced 10-20% discounts for customers who buy more than 10 boxes of cakes.
It is estimated that some 6,800 tonnes of cakes are consumed every moon cake season. This means that consumers spend VND1,360bil (6.8mil boxes of cakes) every mid-autumn festival, if considering that every box of cakes (4 250-gr cakes) is priced VND200,000.
VNN
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