Anger at rip-off retailers. . . Price hike madness fuels consumer discontent

A woman uses EcoCash to pay for groceries sold by a street vendor in Bulawayo yesterday

A woman uses EcoCash to pay for groceries sold by a street vendor in Bulawayo yesterday

Codelia Mondela/Sylvester Chiramba, Chronicle Reporters
CONSUMERS have accused retailers of colluding to hike prices of basic commodities without justification as the same commodities are available from vendors at up to half the prices in shops.

Prices of some basic commodities have increased by up to 100 percent in the last two months.

On Friday, President Emmerson Mnangagwa said retailers should desist from wantonly increasing prices of basic commodities.

Consumers in Bulawayo yesterday demanded to know why vendors, who source commodities from retailers mainly in South Africa, are able to sell at significantly lower prices than retailers who get  foreign currency from the Reserve Bank of Zimbabwe to import the same commodities that they buy from wholesalers.

“The unwritten rule now is that do not buy anything from shops that you can buy from vendors because you will be ripped off,” said Mrs Thokozile Dlodlo.

She said it was mind boggling that vendors who were selling goods brought into the country by cross border traders who bought the commodities mainly from retail shops in South Africa, were selling commodities for prices much lower compared to prices in the shops.

“These cross border traders buy forex on the black market but still their prices remain low compared to those charged by retailers which means retailers are profiteering,” said Mrs Dlodlo.

The Chronicle carried out a snap survey on the streets of Bulawayo where vendors are making a killing and discovered retailers were charging more than vendors.

A 2kg packet of Sunlight washing powder costs between $7 and $9,20 from the shops while vendors sell it for $4. Green bar washing soap is sold for $1,30 by vendors but is selling for $1,59 in retail shops.

Most shops are running Christmas specials but their prices are still higher.

Nivea roll-on is $2,50 from vendors while in retail shops it is selling for $5,29.

Prices of tissue paper have increased in the shops. Baby Soft tissue rolls (nines) are being sold by vendors for $6 but in retail shops are sold for $13, 90.

Nivea lotion for men is selling for $7,99 in retail shops yet vendors are selling it for $5.

The price of 2 litres cooking oil from local supermarkets is $4,48 and vendors are charging $4. Colgate toothpaste is $1,25 from the vendors while at the shops it is $1,59.

The only challenge is that most vendors are demanding cash while supermarkets whose prices are much higher accept EcoCash and bank cards.

A vendor who asked not to be named said business was good because their prices were very low compared to those of retail outlets.

An accounting student from the National University of Science and Technology (Nust) who refused to be named, said retailers’ argument was that vendors do not pay taxes, rentals and other costs such as electricity and water billls as well as salaries.

“That argument does not hold water. What taxes are they talking about? Sales tax is paid by the consumer at the till,” said the student.

Consumer Council of Zimbabwe (CCZ) regional officer for Matabeleland, Mr Comfort Muchekeza,  said retailers were hiking prices willy-nilly taking advantage of the fact that there are no price controls.

He said businesses should upohold ethics and stop profiteering through unwarranted price increases.

President of the Confederation of Zimbabwe Retailers Mr Denford Mutashu blamed manufacturers for the price hikes.

“As retailers we have no choice but to pass on the burden to the consumers. Supermarkets are suffering from cash shortages because they have embraced the use of plastic money. If you are using plastic money manufacturers do not give you a discount,” he said.

“Retailers buy from the local manufacturers unlike vendors who can sneak into South Africa and buy commodities at cheaper prices.”

Commenting on the bread price increase effected yesterday, Mr Mutashu said the price of flour had not increased since 2008 so it was only the bakeries increasing prices.

He said vendors’ prices were lower than those of supermarkets because vendors do not pay taxes.

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  • MSAKANDA

    That panic by people buying more than necessary caused price hikes. They are not justified the prices need to be controlled. how can retailers gain double

  • Gen Gowon

    Let’s not be myopic.Vendors don’t get these items through formal channels.In most cases those items sold on the streets are smuggled into the country through illegal border crossing points.No duty or other expenses incurred on procurement of those goods.Under such circumstances is there any reason why such goods could not be sold at low prices?

    • Captain Dube

      My friend, vendors saw that as Zimbabweans we were being abused by these retailers thus why they jumped into the picture to set us free by bringing in the same commodities but nw in cheap prices. Jst look at Nivea lotion for men, $5=$8, the product is same only diff prices, wer would you buy?

      • magumede

        captain dube ua ignorant and suffer from tshingology. surely ua grade 0. vendors accept cash only which you buy at a pre,ium and come then buy these prices are more ore less the same.

    • Essexvale

      Well, well Roddy boy – It is you using another name again, isn’t it? You seem out of touch with the realities that everyone else acknowledges. Perhaps you are one of those fortunate persons who are replete with funds and therefore not affected by the trials being faced by ordinary citizens? Facts on the ground attest to the fact that retailers are blatantly ripping-off hard pressed consumers, while vendors pose a very attractive alternative. Who but a fool would walk into a retail store to purchase a product that is being sold at less than half the price by vendor outside, huh? Tell readers truthfully; why does it always please you to be at odds with justifiable popular opinion.

    • Think Tank

      Exactly what I was going to say. You cannot compare prices on the black market – saturated with smuggled goods – with prices in the formal market. That’s just clumsy. Zimbabwe will continue to have these problems until we stop ignoring economic fundamentals. Targeting “profiteers” and “economic saboteurs” will not make the real issues go away. Where were their “greedy” retailers when we were trading $US? Have they had a personality change? How is it that prices have skyrocketed since the introduction of bonds – coincidence? The very people you are targeting – who are formal traders – are the ones who keep the wheels of this economy oiled by paying taxes and employing people. It’s easy to emotionalise a topic like this but retailers do not pull prices out of thin air. High prices hurt retailers too!!

  • I dont like ED

    ED is a failure, he cant run this country. all he knows is to kill not politics and economics.

    • MakhosiXamu

      Your analysis is just too good….you have a point. politics of revenge or from mere hatred will not assist our economy. The wanton arrests will not help anybody here. The issue why was the forex externalised ?. If we tackle those issues we will be to make policies that help the economy. The arrests of chombo and kudzanayi will please rally materials(ED’s supporters) but will not assist in bring food on the table. Sloganeering by ED proves beyond any reasonable doubt that he is a failure, period.

    • ndlovini

      ED seems to be working hard to get things right, its too early to criticize

  • true byo

    its normal, especially where there is no rule of law .

  • Wellington

    You cannot do a Coup on prices or the economy

    • Zapalala

      Kkkk ayi seliqalile

    • Essexvale

      True; we’ve seen before, that government interference in such affairs usually has catastrophic consequences.

  • BonzoReChihuta

    Does that mean there has been a sudden hike in rentals, taxes, estate duty etc on the goods these retailers are bringing in? Even they can’t justify why they are raising the prices. Truth is, in Zimbabwe we have a terrible business model. Where normal countries will reduce prices to encourage Christmas spending, trust Zimbabwean businesses to actually increase theirs! Sad!

  • qondani

    I remember when bob accused them of hiking prices when he went to un, I don’t think he was accusing g40. They are just the same, vendors must sell from their houses if the price is lower they will make money

  • Dumakude

    Retailers are businesses, they face costs and when these costs go up, they pass it on to consumers so that they can make a profit. Increases that are viewed as “wanton” have to be justified, thats why there is a consumer watchdog

  • Mwalimu

    There are now three currencies around the USD in Zimbabwe: $Bond cash, $RTGS/Ecocash/Swipe/Telecel/OneMoney and $USD. For every $USD1 there is $bond 1.25 and $RTGS 1.55. The problem started when Government started issuing a lot of Treasury Bills to fund the RTGS fictitious electronic money. Unless and until the stocks of RTGS is dealt with the problem of price increases in the formal sector will not disappear.

  • Essexvale

    Elsewhere in this publication, the Consumer Council of Zimbabwe – CCZ, gives an analysis on the reason for price rises for groceries. CCZ bases it’s calculations on a food basket for a family of six. However, it becomes obvious that the scale used by CCZ is patently ineffective since independent sources show that retailers have raised the prices of certain commodities by 100%. As a consumer who’s been through the nightmarish hyper-inflationary period of 2004 – 2009, I dread a repeat of those dark days. The way things are moving now, certainly raises a red flag that the repeat edition is just round the corner. My opinion is that the CCZ, being a government supported entity, like its peers, is weak and ineffective in appropriately conducting its mandate of protecting the consumer from profiteering retailers. My take on this is that an effective alternative to the lukewarm interventions of CCZ would be for consumers to take their complaints to independent and non partisan residents’ associations and perhaps pressure groups such as AAG. Yet the most effective alternative, in my opinion, will be for consumers to express their displeasure against greedy retailers by taking to the streets in protest ….. and boycotting shops that practice profiteering!.

  • Diwani Wadazo

    Its simple remove the import ban buisness will import in bulk there by bringing down prices imagine if pnp can send truck loads of goods from SA and chopies from bots prices will surely come down

  • Mixed Race

    My contribution on these unrealistic prices by big supermarkets like Pick ‘n Pay is that,these retailers are taking advantage of us domicile Zimbabweans to compensate for their losses in their home base markets,whereby their prices are strictly controlled and monitored by the alert buyers or customers.
    Three weeks ago I challenged the management at the above mentioned supermarket to explain to me why a tube of Sensodyne Repair Toothpaste which was costing $5.45 a few weeks ago has jumped in price to $10.45.None of them could give me a valid explanation ,except to complain about foreign currency allocation,which made me laugh at them because the same vendors in the street explain worse exchange regulations as compared with them.I told them about this but they tried again to use transport charges and silly duty levels.These retailers are just manipulating our corrupt authorities to perpetuate our suffering.
    The time has come for us to say enough is enough and take corrective steps to regularize these prices.We are our own liberators against these unscrupulous individuals.We now see silly bakers raising the price of bread without valid additional input costs,just to make increased profit.Where is our government?We need it to control these gangsters who are looting and frustrating the lives of the poor.

    • Mixed Race

      correction-sentence with explain should read experience……

      • Essexvale

        I often enjoy your contributions on this platform and usually feel sorry that you have to resort to a second post in order to make a correction of your first. I had the same problem until I discovered the avatar option; so to speak. All you need to do is open a Disqus account (you’ll find it on the iconed range of options on the left bottom corner of the discussion box in which you type your comments). Should you fail to locate it; ask a friend who’s ICT smart to assist. That way, you’ll be able to automatically post under your chosen avatar which cannot be interfered with or cloned. Additionally you’ll have the option to make any corrections you wish on your comments even after posting. Happy writing my friend!

        • Mixed Race

          Thank you,I will try your suggestion again because last time I tried it,it did not work well.I had similar problems in deleting my old comments on yahoo website until I managed doing it using a better shortcut way.