LOCAL retailers importing goods from neighbouring South
Africa have been accused of profiteering as their prices have been rapidly
increasing in foreign currency terms in recent days.
Ironically, retailers have always called for the use of
foreign currency saying it would stabilise prices. However, after Government heeded their request recently,
they appear to have continued to increase prices wily nilly.
Before Zimbabwe and South Africa imposed lockdowns to curb
the spread of Covid-19, most Zimbabweans frequented Musina in the neighbouring
country to buy basic commodities.
Shoppers were claiming that it was cheaper to travel to
South Africa and purchase their needs as opposed to buying them locally.
Others depended on cross border transporters who would
bring goods from South Africa at a mark-up, though still cheaper than goods in
local shops.
With the lockdown, citizens are now confined in the country
and forced to buy from local shops, which they say are taking advantage of the
situation by overcharging.
An investigation by Chronicle yesterday revealed that major
retail shops were in most cases, charging more than double what retailers
charge in South Africa.
It was noted that big retailers buy from manufacturers or
wholesalers in the neighbouring country and should therefore, like for example
retailers in Botswana, be able to put a small mark-up on the price charged by
retailers in South Africa and still make huge profit.
The local shops although pricing their goods in local
currency, allow clients to pay for goods in foreign currency in line with the
Government’s policy.
At TM Pick n Pay and OK Zimbabwe the retail giants are
using a ZW$1:US25 cross rate for those intending to buy using foreign currency.
While OK Zimbabwe does not accept payments in rands, TM
Pick n Pay accepts the rands payment at a rate of 1: R14,3.
Other retail shops that include Oceans and Greens
Supermarkets also accept foreign currency but using higher rates.
Products such as 66 Huggies disposable nappies are being
sold for $872 translating to R609 while in South Africa it costs about R379,
500g Kellogg’s cornflakes box costs $139 converted to R97 while in South Africa
the same product costs R37.
A 10kg bag of mealie-meal is being sold for R87 in South
Africa while locally its going for $287 which translates to R200 after
converting using the local cross rates.
One of the mostly imported products, Nan Baby Formula, is
going for $889, converted to R778 in the local shops while in South Africa it
costs R173.
The same trend occurs for other products including toilet
paper where a pack of nine is sold for $180 converted to R125 using local
official rate and R48 in South Africa.
A litre of Ceres Fruit Juice is going for $139 converted to
R97 while being sold for R22 in the neighbouring country.
Consumer Council of Zimbabwe Matabeleland regional manager
Mr Comfort Muchekeza said the consumer protection body has also noted with
concern the arbitrary pricing by retailers selling imported goods.
“We have noted the prices here are almost three or four times
higher. Even if you factor in transport costs and import duty on all these
things prices are still too high. For instance, 2 litres of cooking oil
somebody was saying in South Africa it costs R57 and here the same product is
$150. Even if we use a black-market rate, you will realise that the difference
is still too much,” said Mr Muchekeza.
He said CCZ has engaged manufacturers and Government in
trying to assess the value chain causing high product prices and have concluded
that retailers are the problem.
Mr Muchekeza said some retailers want to get rich
overnight.
“Here and there we might have unscrupulous manufacturers
but the major problem lies with our retail, the middlemen. This is more than
profiteering, what we can say is that some who are in business do not have
ethics required of a business and they would just want operate today and tomorrow
they are multi-billionaires,” he said.
Confederation of Zimbabwe Retailers Association (CZRA)
president Mr Denford Mutashu said it was normal for prices of imported products
to be high.
“It could have been better if we could work with facts and
figures but currently, I don’t have those figures. But obviously it may be the
issue of costs which they may have encountered. They might have incurred duty
because duty on non-essential goods is actually quite high. Essential products
like mealie-meal and rice do not carry any duty. So, the issue of
transportation cost, duty and extra charges could be the factor. My general
comment but I will not think that price would be double of what is being sold
in South Africa in any way,” said Mr Mutashu.
“We are comparing selling prices, and they could have
factored in the issue of mark-ups in prices that you are looking at in South
Africa. The price differentials from our historical study is that a product may
carry a 25 to 30 percent differential or more. After factoring transportation
in and other cost the prices could be around 40 percent.” Chronicle
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