RETAIL chain OK Zimbabwe has said it will bank on dollar deals to grow the customer base despite the rise in the number of unregulated informal operators in the country.
Formal businesses in Zimbabwe are battling increased competition from a growing informal sector which does not have operational costs like taxes and wages.
“It has been an interesting watch as perhaps most formal retailers now are battling for survival,” OK Zimbabwe said in a statement.
“The rise of the unregulated informal operators who are mostly arbitraging has caused more headaches than good for the formal ‘guys’ like OK Zimbabwe, TM Pick n Pay, Gain Cash & Carry and so many more. This has created a whole new spat of ‘dangerously unhealthy competition’.
“In instances where some are paying taxes, some are not; where some are using the regulated bank exchange rate; some are not, hence causing artificial or distorted price points in the stores.”
OK Zimbabwe indicated that the informal retailers are infamously using the black market rate and mark the same products downwards, causing “forced death” on the formal retailer.
“Can this be solved though in the short and long-term? Yes, only by government policy intervention which levels the playing field to enable the formal retailer to survive,” the retailer suggested.
“The dangers are apparent as some have even started closing shops, some are under corporate rescue and many jobs are going to inevitably be lost.”
For instance, Metro Peech & Browne Wholesalers recently went under corporate rescue administration, partly due to unfair competition from the informal sector.
OK Zimbabwe, however, said it had taken a route to help the customer go through such tough times “we are in”.
With all the issues facing the formal retailers, OK Zimbabwe has not let that deter it.
In the past months, the retailer came up with some promotions termed dollar deals, targeting as many customers to access products at the least cost.
It has different products and combos underlined by the “dollar deals” across its store brands, which are OK stores, Bon Marche, OK Mart and Food Lovers Market (Avondale, Borrowdale and Bradfield in Bulawayo).
Some of its interesting dollar deals are “Sadza neMabonzo”, which sell across all OK stores, Cascade and pies, hot dogs and carbonated drinks, among others.
“It takes one to visit any of their stores to truly experience these deals. The group has successfully emerged as a leader in this US$1 revolution. It remains to be seen for how long they can and will sustain this trend.”-NewsDay