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Speaker 1: You might recall last month speaking with John Nissbull from Nippies,

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Speaker 1: Orange Juices and Fruit Juices, how their electricity bill went

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Speaker 1: from just over fifty grand a month to run their company.

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Speaker 1: And that's across the board that contract ended and the

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Speaker 1: spot market that he found himself on electricity costing double

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Speaker 1: at over one hundred thousand a month, and you can

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Speaker 1: only imagine it's at that raked only a matter of

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Speaker 1: time before Orange Juice starts costing that little bit more. Well,

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Speaker 1: Villis say that they may have to put up their

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Speaker 1: prices some eighteen percent after rather I should say after

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Speaker 1: power bills went up by eighteen percent. Now I don't

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Speaker 1: know how much prices will go up by, but their

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Speaker 1: power bills have risen by eighteen percent. Villis employ around

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Speaker 1: three hundred and fifty people. Meat prices have risen as well,

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Speaker 1: Wages have risen as well. Of course, that never ends

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Speaker 1: good thing, I suppose if you're working, but it doesn't

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Speaker 1: help a business trying to keep costow. So when you're

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Speaker 1: going to buy your favorite pasty and doughnut, maybe from

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Speaker 1: Billy's Family Breakeries, Well, ultimately they're electricity bill up eighteen percent.

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Speaker 1: That's eight and a half thousand dollars a month more

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Speaker 1: that they have to fight. That's that many have to

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Speaker 1: find that many more pies, pasti, sausage roll they need

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Speaker 1: to sell to make up the difference. Peter oa Tree

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Speaker 1: is general manager at Billy's Family Bakeries.

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Speaker 2: Peter, good morning, Good morning, Matthew.

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Speaker 1: It's not good news. So any idea how much you're

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Speaker 1: going to put prices up by yet.

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Speaker 2: Look, there's a range of factors. It's not just the

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Speaker 2: power aspect, as you mentioned, it's also wage increases. We've

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Speaker 2: held our prices for the past eighteen months. Obviously, there

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Speaker 2: was a wage increase last year of over five percent,

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Speaker 2: and then another three percent increase this year. They coupled

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Speaker 2: with meat prices as well, spiking. Yeah, so we're looking

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Speaker 2: at about a six percent increase on our oldtel price lists.

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Speaker 2: So went from so it's actually effective today.

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Speaker 1: Okay, all right, so that's happened, right, Yeah, not good news.

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Speaker 1: Now you want to keep the business going. Obviously, it

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Speaker 1: goes without saying keeping people employed and have people buy

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Speaker 1: your products. It gets harder and harder to do business though,

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Speaker 1: doesn't it.

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Speaker 2: Yeah, for sure, Looking at the end of the day,

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Speaker 2: we we're quality products. If we want to maintain our quality,

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Speaker 2: we need to pass those costs on to our consumers.

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Speaker 2: If prices are going up, yeah, we need to We

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Speaker 2: need to pass those those costs on so that so

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Speaker 2: that we're around. If you're not, if you're not doing

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Speaker 2: that well, then you're not going to have a have

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Speaker 2: a long term future.

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Speaker 1: And just and so the cycle begins then because wages

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Speaker 1: go up in response to prices going up, and here

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Speaker 1: we go.

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Speaker 2: Yeah, for sure, I can certainly understand that to that

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Speaker 2: point of view, But at the end of the day,

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Speaker 2: we just have to absorb these things. We don't have

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Speaker 2: the influence over over the power market or over you

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Speaker 2: wage increases. We're a business and we're going to hit

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Speaker 2: with expenses and we just need to make all that work.

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Speaker 1: What needs to happen beyond here, Peter, I mean economic

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Speaker 1: conditions obviously need to improve. But state government saying well,

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Speaker 1: there's nothing we can do the power market, sorry, it's

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Speaker 1: national which does maheading really because they can do a

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Speaker 1: few things, and one is take back the power to

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Speaker 1: set wholesale charges, the network charges from the Australian Energy

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Speaker 1: Regulator where they've passed that power onto so they've got

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Speaker 1: I suppose a whipping dog of sorts to blame if

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Speaker 1: prices go up. But there are things governments can do

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Speaker 1: and they created the market, maybe create it so it's better.

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Speaker 2: Yeah, sure, Look, I mean that's they're the experts in

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Speaker 2: that field. We're a bakery. Yeah, you know, we're a manufacturer.

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Speaker 2: We have to absorb those the costs, all the benefits

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Speaker 2: of those decisions that are made. And we're really at

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Speaker 2: the mercy of our leaders to make those right decisions

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Speaker 2: to create the right environment so that business can flourish

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Speaker 2: in our state.

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Speaker 1: Does it frustrate those governments? Just sorry, not not much

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Speaker 1: to see here. We've done all we can. There's packages

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Speaker 1: available and whatever else. But this is this is life

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Speaker 1: as we know it. It must be frustrating, surely.

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Speaker 2: Well, it's just it's just part of doing business, you know.

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Speaker 2: If you if you take on those those risks and

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Speaker 2: and you take on those responsibilities, that's a part of

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Speaker 2: the landscape and that's that's what you do with Look

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Speaker 2: at the end of the day, you know, Village has

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Speaker 2: been a longstanding business in South Australia over the fifty

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Speaker 2: six years. Heritage. We've got amazing customers that are so

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Speaker 2: little to our brand, and we're very blessed to have

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Speaker 2: that part of the market, which we certainly don't take

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Speaker 2: for granted. And yeah, brunning a business is tough. There's

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Speaker 2: all these external factors that you know that you need

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Speaker 2: to absorb and and direct the path out of that

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Speaker 2: so that you have the business purishes and you continue

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Speaker 2: to make quality products.

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Speaker 1: Can you rule out job losses moving forward, Peter.

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Speaker 2: Yeah, definitely, You've got no plans of a couple of jobs.

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Speaker 2: It's certainly not on the agenda at all.

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Speaker 1: All right, what about trying to open up new markets

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Speaker 1: into state. I'm sure you've done all this over the years.

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Speaker 1: In any case, any opportunities there to expand further.

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Speaker 2: Yeah, we've got several several irons in the fire that

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Speaker 2: we're constantly working on markets interstate. Yeah, there's plenty of

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Speaker 2: scape for us to go in those markets. And yeah,

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Speaker 2: we've got we're having discussions on a whole range of

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Speaker 2: markets on the East and Seaboard, in particular, how.

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Speaker 1: Much of meat price has gone up by what effect

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Speaker 1: does that had?

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Speaker 2: Meat prices gone up by about fifteen to twenty percent.

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Speaker 2: Meat is the biggest ingredient costs that we have. Obviously,

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Speaker 2: meatpie contains meat with definitely one of the Billy's philosophies

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Speaker 2: that made our business as fantastic as it is today

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Speaker 2: having those values. And yeah, meat is a massive cost

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Speaker 2: of a meat pile. We process our own so that

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Speaker 2: we can guarantee the quality of the product going into

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Speaker 2: that into our end product because at the end of

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Speaker 2: the day, if your product's you know, if somebody gets

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Speaker 2: a piece of gristle or a piece of bone, they

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Speaker 2: don't know that you've brought that product in. So by

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Speaker 2: us controlling that process can guarantee the quality of the product.

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Speaker 1: Okay, what's led to that rise in meat costs? Electricity?

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Speaker 1: We know we're all bearing the brunt of that. But

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Speaker 1: with meat, is it transport? Is it aboutois qui? So

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Speaker 1: you do your own, But you know what has led

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Speaker 1: to that huge increase fifteen to twenty percent is pretty considerable.

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Speaker 2: Yeah, Look, the meat market fluctuates depending on seasons. You know,

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Speaker 2: if there's more if there's more feed around, then you know,

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Speaker 2: people tend to hold them to their stocks for longer

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Speaker 2: because they can put the extra kuilos out's being brought

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Speaker 2: in to the farms. Then people are more inclined to

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Speaker 2: sell their beach. So it is. It is a changing market,

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Speaker 2: and we project that out one to two months in advance.

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Speaker 2: But you know, once again, you're really at the mercy

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Speaker 2: of that market. It's not something which you know you

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Speaker 2: can buy the next year, something which is not a

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Speaker 2: dry product. We do in fresh ingredients, and you know

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Speaker 2: you've got market costs similar with the freend vegetables, all.

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Speaker 1: Right, So everything's going up and you know, you know

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Speaker 1: often there I think, as we've said many times on

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Speaker 1: this show, the basket of food at the shopping market

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Speaker 1: supermarket checkout has risen considerably in the last few years,

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Speaker 1: and we've all felt this thing of that. So business

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Speaker 1: as usual, as you say, Peter, and I know recently,

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Speaker 1: what in the last year or so, you've opened a

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Speaker 1: fourth cafe Devilie, so they're certainly expanding.

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Speaker 2: Yeah, we've got the franchise models that we've got three

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Speaker 2: franchise models operating currently and the cafe at my l

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Speaker 2: end at the bakery, all.

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Speaker 1: Right, so people can go in and enjoy some some

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Speaker 1: great South as he Tucket traditional food here in Adelaide.

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Speaker 1: God On, you appreciate your time this morning.

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Speaker 2: Thank you. You appreciate your time.

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Speaker 1: Peter Hutty there, who is general manager at Villi's