adminfollowing a fault at the country’s largest cement factory gave some shopkeepers who had stocks the opportunity to gouge their customers and push the profit margin into the upper atmosphere.
A 50kg bag that should sell for between US$12,50 and US$13 suddenly was on sale for well over US$20 with those shopkeepers doing this appalling profiteering not even blushing.
Some of those stocks had even been bought from reputable dealers at normal prices, not to use but for resale.
This made the shortage even worse.
But, for some obscure reason, we also had ordinary people rushing to buy at these grossly inflated prices, despite assurances from the factory that things would soon be back to normal.
It seems that there are consumers who were unable to work out that in the modern era, with Zimbabweans using hard currencies, that no shortage can be permanent.
So profiteering retailers, coupled with gullible consumers, created a mess that should never have happened.
The consumers who bought at the ridiculous prices can now rue their rashness when they see, a couple of weeks later, cement at a normal price.
And we hope the profiteering shopkeepers will now be forced to take a big loss on their dealing, and probably have to wait years before their customers trust them fully again.
Amid all the accusations we must remember that most retailers simply sold out their stocks at normal prices and told their customers that new stocks would be coming soon when the factory was back in production.
These are the retailers who will now win their customers’ support as business returns to normal.
We should perhaps bear with those retailers who organised imports of Zambian cement; thanks to the duty imposed at Chirundu and the extra cost of transport this will be more expensive than cement made in Harare.
The import might have been, in retrospect, a bad business call, but some of those who made it should be considered honest.
But the profiteering traders, those who pushed up the price of their own stocks or bought at normal retail prices and added on huge mark-ups in a sellers’ market, can be punished quite easily.
Zimbabwean consumers, in the modern competitive environment, do not have to deal with any particular shop.
They can look around and they can deal with whom they like.
The intense competition in most retail sectors, including those for building materials and for hardware, is more than adequate to keep margins within reasonable limits.
So we advise everyone to remember who was trying to gouge them and take all their business to those who continued to charge reasonable profit margins and who carefully explained why they were short of stock.
Lafarge is now making more than 1 000 tonnes of cement a day, having brought its factory back into production, so the pent up demand for a reasonably-priced product will soon be satisfied.
Again it would be a good idea if Zimbabweans stopped panicking when there was a temporary shortage, believed the manufacturer or importer, and just waited patiently for the supply chain to return to normal.
Everyone needs to understand that because of the currency reforms, we simply do not have permanent shortages any more.
If the local supplier cannot cope, we can import easily.
That in turn puts pressure on local manufacturers to undercut their foreign competitors, an easy task for a low-value, high-bulk item like cement.
Transport and very modest duties, and because Zambia and Zimbabwe are both in Comesa the duties on each other’s manufactures have to be modest, will still push up prices of imports above those charged by local manufacturers.
But we suspect the price differences are not nearly as high as some retailers claim; we suspect that a middleman made the serious profits and the retailers are going to be stuck with an over-priced import.
In future, when there is a temporary hitch in something like cement, a couple of reputable chains could easily work out a decent import deal and then take orders, with proper costings shown to their customers.
The return to normality also shows that price controls are not effective.
No one obeys them even when they are imposed. What is effective is enough competition to keep everyone automatically honest.
And if that is backed by Zimbabwean consumers prepared to reward the honest trader with their business, and boycott the profiteering retailers, then the next time there is a temporary shortage of some fairly essential item we will see a lot more honesty and lot more consumer patience.
Online Reporter