Retailers battle for consumers

RETAILERS, who are currently under fire for exploiting consumers through extortionate pricing, are now battling to fire-sell their products by offering promotions.

Consumers have largely boycotted major retailers — in favour of small, informal retailers — after they inexplicably hiked prices of goods since September 21 last year.

However, top supermarket chains — Pick n Pay and OK Zimbabwe — are now locked in a fierce battle to lure consumers by throwing “month end specials”.

Interestingly, the “promotions” have exposed the retailers as greedy and bent on profiteering given the huge price disparities, even for goods on “sale”.

OK Zimbabwe, which used to pride itself as the cheapest supermarket chain in the country, has prices that are way than Pick n Pay, for both goods on “special” and the usual prices.

For instance, OK has reduced the price of 100g Chompkins potato crisps to $1,39 while Pick n Pay is selling the same product for $1,29.

Curiously, OK’s “special” offer does not include some basic commodities such as cooking oil, whose price has been a cause for major concern among consumers.

While Pick n Pay is selling the ZimGold 2 litre cooking oil bottle on special at $3,45, OK has remained stuck on $3,89 which obtained towards the festive season last year.

There is also no special offer for 10kg roller meal ($4,85) at OK which Pick n Pay has reduced to $4,19.

The huge price disparities come at a time when Government has begun “internal devaluation” aimed at ensuring that consumers get a fair deal.

On Monday, Government announced a reduction in the excise duty on petrol and diesel by 6,5 cents and 7 cents respectively.

The move is aimed at reducing the cost of doing business in the country, and consequently, the prices of goods and services.

Confederation of Zimbabwe Retailers (CZR) president Mr Denford Mutashu mollified the rent-seeking behaviour by retailers, telling The Herald Business yesterday that the pricing disparities are an indication of competition, which is healthy in any normal business environment”.

“The retail and wholesale sector has become a haven of stiff competition amongst players and those who may choose to overprice will fall by the wayside as customers have wider options to buy from,” said Mr Mutashu.

He concurred that as Government moves to address major cost drivers, it is widely expected that prices would fall further.

The Confederation of Zimbabwe Industries (CZI) has indicated its willingness to “incorporate this fuel price reduction” into the pricing structures.

Prices are expected to fall by between 1 percent and 5 percent in response to the new measures by Government.

Said CZI president Mr Sifelani Jabangwe: “The overall consumer price index is therefore inclined to fall further from the 1,2 percent increment experienced over the 2016-2017 period.

“Out of the 15 monitored basic commodities, prices of economy beef, for example, are expected to fall by an average of 10 to 20 percent.”

Some butcheries have already started reducing the price of beef from highs of $8 per kg to about $4,50.