The Sunday Mail
Enacy Mapakame – Business Reporter
ZIMBABWE’S top five supermarkets – OK, TM, Pick ‘n Pay, Spar and Food World – are reluctant to allocate more shelf space to local goods as they have reservations on their quality, efficiency and standards.
At a Buy Zimbabwe conference for retailers and suppliers in Harare last week, which ironically was designed to encourage businesses to buy locally made goods to boost industrial activity, retailers also claimed that their procurement patterns were consumer-oriented, and not designed to cheer sub-standard products from domestic suppliers and manufacturers.
In the first six months of the year, local companies shelled out more than US$400 million on foreign groceries, mostly from South Africa.
“If the consumer is not demanding a product, we will not stock it. It won’t move . . . If there is a local product and import, we consider (the) local product first, but we will look at its price, packaging and quality,” Food World operations manager Mr Farai Chisvo told the conference.
Retailers said while they were willing to work with local producers, some were unreliable, inconsistent and thus attracted little consumer interest either through poor quality or unattractive packaging.
Mr Chisvo added: “We need to be sure there is enough capacity in local companies. There are cases where some companies have pledged to supply goods, but after experiencing slight problems, they stopped supplies. So, we want to be 100 percent sure once we engage local manufacturers, there will be continuity of supplies.”
Failures in quality and consistency disrupted value chains and gave room for imports to flourish, he noted.
More than 60 percent of goods sold in Zimbabwean supermarkets are imports mainly from South Africa, Zambia and Botswana. Most imports are cheaper than locally-produced goods.
Industry has complained that imports present unfair competition and want tougher regulation from central Government.
Lack of market research is also dealing a blow to local manufacturers who tend to oversupply a particular product while neglecting others.
“Suppliers tend to congest the market with one product because they heard it is doing well on the market; for instance, tissues. You cannot expect them to move on shelves,” said Mr Emmanuel Chitenje, a Spar official.
“At Spar, we do not have a specific policy on shelf space for local goods, but we always give them a chance and see how they perform after (a) trial period. Customers determine what we will have on our shelves; they decide what they want.”
As foreign-owned companies downsize, relocate or shut down, manufacturers should now step up to the plate and be counted, said OK Zimbabwe chief operations officer Mr Albert Katsande.
He cited bath soaps and margarine among other products as areas local producers could successfully exploit.
OK Zimbabwe obtains 40 percent of such consumables from domestic manufacturers, leaving the remainder to imports
“Every gap we see on the market points to an opportunity. Foreign retailers and imports come here because there is a market. Local industry then should tap into that and bridge that gap,” he said.
Mr Katsande said OK Zimbabwe buys 80 percent of its fruits and vegetables from domestic producers, while all poultry, butchery, bakery and cooking oil needs are procured locally.
However, Surface Investments is the only local cooking oil-maker currently operating at optimum capacity and could satisfy demand.
Similarly, sugar demand for domestic use is sufficiently met from local production, but there are still signifcant gaps in satisfying industrial demand.
Some manufacturers told the conference that retailers were not giving them a fair chance.
A spokesperson for a company that produces household hygenie consumables said their Chitaitai floor polish brand commanded consumers loyalty but some supermarkets turned them down on unclear reasons.
Manufacturers said they wanted Government to reserve about 60 percent of supermarket shelf space for locally-produced goods.
Finance Minister Patrick Chinamasa expects imports to rise 9,2 percent to US$8,3 billion this year on continued low industry performance. Industry is operating at 39 percent capacity due to weak consumer spend and high production costs.
