KUALA LUMPUR (June 5): RT Pastry Holdings Bhd, en route to the ACE Market, has locked in key inputs with suppliers amid rising cost pressures while still cautious on raising product prices.
RT Pastry is managing input volatility through long-term supplier relationships while certain packaging costs were secured until August despite recent global disruptions, the bakery chain’s chief operating officer Tia Yu Hoo said at a news conference following the launch of its listing prospectus.
“We have close relationships with suppliers where we can lock down some prices to mitigate price increases,” he said.
WATCH: RT Pastry unfazed amid rising costs, weak sentiment
Prices of plastic packaging, in particular, have soared because of the disruption linked to geopolitical tensions in the Middle East and that have hit consumer firms ranging from dairy producer Farm Fresh Bhd (KL:FFB) to sugar refiner MSM Malaysia Holdings Bhd (KL:MSM).
RT Pastry sources packaging materials, including boxes, paper bags and containers, as well as consumables like muffin cups and stickers mainly from Malaysia. Together, packaging materials and consumables accounted for about 12% of its total purchases of ingredients and supplies.
The company adjusts selling prices selectively, particularly when sharp increases occur in key ingredients such as flour and cocoa, at a time of soft consumer sentiment, Tia said.
“There are changes in buying power” and RT Pastry is responding by introducing new products regularly, including seasonal and festive offerings, Tia said. Still, bakery products remain essential items, helping to support steady demand, he added.