The Sunday Mail
HAVING endured a very challenging year, where disposable incomes and consumer spending declined, retailers are strategically positioning themselves in a heated dash for the festive season boon.
Spending patterns in the retail sector are cyclical and the festive season – which includes Christmas Day, Boxing Day, New Year and, in the case of Zimbabwe, Unity Day (December 22 2014) – often provides a lift for the sector.
On-street and in-store promotions usually take centre stage from the cities to the districts as companies try to wrest customers from one another.
The country’s biggest suppliers such as National Foods, Delta Beverages, African Distillers, Pro Brands, Surface Investments and the Grain Marketing Board (through their Silo brand), seem to have adequately prepared themselves for the anticipated demand.
A survey by The Sunday Mail Business in towns across the country revealed that most shops were already full to the rafters with groceries and other items that prove popular around this period, such as electricals, crockery and cutlery.
Metro Peech and Browne Wholesalers branch manager for Rusape Mr Patrick Chiunga said the company was looking forward to the festive season.
The business, which has 13 branches countrywide and is a member of the Buy Zimbabwe campaign, sources the bulk of its products from local suppliers.
Government has taken a hard line on imports, particularly for goods that can be produced locally.
“The company’s policy is to promote the local industry and as you can see in every department at this huge premises the local product dominates every shelf,’’ said Mr Chiunga.
Metro Peech and Browne Wholesalers is among enterprises that have re-entered the market in recent years and has rapidly regained its foothold.
Mr Chiunga also noted that the company launched its customer loyalty project, the Customer Reward Scheme, in Rusape last week.
Through the programme customers accumulate points upon purchasing goods from the wholesalers, which points can be redeemed for household appliances and groceries once they rise above the 15 000 mark.
The maximum threshold is however pegged at 750 000 points which rebates with a Toyota Corolla vehicle.
“We have different types of competitions that our customers who are chiefly the traders can make use of, for example we have just completed the Super Trader Promotion while the ongoing Customer Reward Scheme will run concurrently with the Christmas and Back to School Promotion which ends on January 10,’’ explained Mr Chiunga.
Mr Simba Chikawarika, who recently won a 1,5 tonne Toyota truck as a result of the Super Trader Promotion, indicated that it was important for retailers to reward their customers.
There are expectations that Government’s move to increase the tax-free income threshold from US$300 to US$350, including widening of the tax bands, will help release money into the economy.
The dispensation is part of a raft of new measures unveiled by Treasury to help reduce prices and promote spending.
It is hoped that rising disposable incomes will help increase aggregate demand.
Similarly, the Reserve Bank of Zimbabwe last week released new coins that are meant to improve pricing structures on the market.
Concern remains that local goods remain relatively pricier than those imported from the region.
“During the course of the year, I have on many occasions stated the need to address the cost structure in our economy.
“The cost structure in our economy makes us uncompetitive, relative to our trading partners.
“I am happy to acknowledge the very comprehensive study done by the Ministry of Industry and Commerce in identifying cost drivers that have contributed to the high cost of production in our economy.
The cost drivers identified are labour, power, water, finance, transport and trade logistics, tariffs and trade taxes, taxation as well as information technology.
“Cabinet has approved a wide range of business friendly recommendations made by the Ministry of Industry and Commerce and aimed at addressing these cost drivers in line with regional trends,” said Finance Minister Mr Patrick Chinamasa during the 2015 National Budget presentation on November 27.
