The price of a standard loaf of bread has increased. The President of the National Bakers Association(NBAZ), Dennis Wallah, has associated the price rise indicated by Bulawayo retailers with the increase in prices of production and distribution costs. This increase in costs was attributed to the rise in fuel prices and utility charges.
Wallah shared the following sentiments:
“Its not a hidden fact that if you look at the price of fuel it went up, so obviously distribution cost goes up. And also utilities have moved astronomically high obviously all these factors result in the cost of product spiralling upwards.”
The price of a standard loaf of bread has risen by 6,8% from $88 to $94. Bakers continue to assign the blame to the recent upward review of the prices of fuel and utilities. Utilities are said to have risen significantly with some, like water bills even increasing by margins of over 300%.
Fuel prices were also increased twice since the beginning of the year. The Zimbabwe Energy Regulatory Authority (ZERA) also attributed to the upward hike of fuel prices. This was coupled with the general rise in prices of fuel on the International market.
National Consumer Rights Association spokesperson, Mr Effie Ncube, expressed a disapproval of the hike of bread prices saying it could not be justified from a consumer standpoint. He said the following:
“From a consumer standpoint, there is absolutely no justification whatsoever for the rise on the price of bread. Fuel and other utilities dominate the price of services and goods downstream, but there is no justification to the mark-ups that they did even taking that into account.”
Mr Ncube suggested that their business model should no be one that transfers the weight of the companies operating costs to the consumers. He said:
“They need to develop to a business model that allows them as businesses to function and prosper without constantly rising prices like what they are doing. “There still has no justification for the mark-up rates that they are putting in order to respond to changes in the supply chain.”
Manufacturers, however, argue that business have been responding to the general adjustments in various rates and fees across the economy and the absorption of these costs reflected in price increases as the costs are passed on to the consumer.
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