Few weeks after the Director General of National Bureau of Statistics (NBS) , DR Yemi Kalejaiye, announced that the country has exited recession, the prices of many brands have begun to fall, while some brands have yet to reduce their prices.
Investigations conducted by BusinessHallmark showed that, many brands which jerked up their prices, during the foreign exchange squeeze which led to the recession in early 2016, have recorded drop in their prices.
Findings showed that brands such as TEEM bitter lemon, a brand from Seven –UP PLC which was increased from N100 to N150 per pet bottle, has now been reduced to N100. The same goes for Pepsi and 7up brand all from the stable of Seven UP PLC.
Also, soft drink manufacturing giant, Coca Cola bottling company of Nigeria PLC has also slashed the prices of Coke, Fanta and Sprite soft drinks from the former N150 per pet bottle to N100.
The management of Power Oil brand, Raflex Oil Enterprises, which formerly sold its oil sachet for N120 per sachet, now sells it for between N80 and N100 per sachet. In the same vain the price of the popular noodles, Indomie noodles which was sold forN70 per sachet is now sold for N50 per sachet.
BusinessHallmark checks also showed that washing bar soap that was sold for between N130 and N110 per bar now sells for N100 in most shops in Lagos.
Further findings showed that despite the marginal slashed in the prices of the brands, the level of patronage is not commensurate with the level of price reduction.
A shop owner, Mrs Bimbo Olayinka in an interview w
ith BusinessHallmark said the level of patronage is not encouraging despite the reduction in the prices of many brands. In her words, “It’s true that in the past few weeks many of the brands have reduced their prices. However, the level of patronage is still very low.”
She stressed that many consumers do not have enough cash to buy the products, adding that many Nigerians who lost their jobs to the recession cannot secure another employments as such unable to buy the brands even though the prices have started to crash. She stressed that government at the various levels were owing their workers, which has made it very difficult for many people to buy the brands they would have wanted.
Her viewwais shared by Mr. Emeka Osuji who runs a provision retail shop at Idumota, Lagos, and admitted that despite the fact that many brands have reduced their prices, the volumes of sales is still very low.
Osuji who attributed the problem to the fact that despite the country announcing that it has exited recession many Nigerians have yet to feel the impact of the recovery.
In his words” the government and the NBS have announced that the country has exited recession. It is also true that many manufacturing companies have reduced their brands prices, yet many people do not have the money to buy these brands”.
On why many Nigerians were unable to buy the products now that their prices have reduced, he stressed that school children are just resuming for a new season, adding that the students of the public universities who were at home as a result of the strike by the academic and non academic staffs have also returned to their schools, which would demand money from their parents.
“The reduction in the prices of many of the locally produce brands occurred when school children were resuming for a new academic year. It is also the period the labour leaders called off their industrial action against the Federal Government.
“So, many people whose children were resuming for a new academic year are challenged with so many financial commitments. That is the main reason why we are not experiencing the level of patronage one would have expected now that the prices of many brands were begging to come down” he stressed.
An investigation at Just rite Super stores, at Abule Egba, showed that people were seen buying many of the brands which prices have witnessed a reduction, than the brands which prices have remain the same.
An attendant at the store who spoke to BusinessHallmark off record, disclosed that her organization were hoping to witness more sales than before, as a result of the reduction in the prices of many locally manufactured brands.
She added that the volumes of sales has increased in the past few weeks, adding that she could not place her fingers on what has led to the increase in the sales of many locally produced brands. The source said she expect the prices of the locally produced brands to crash more, stressing that the level of reduction is a far cry from the current exchange rate.
A visit to Shoprite mall at Ikeja, showed that many people were going for the brands which prices has dropped. One of the visitor to the mall who simply identified himself as James disclosed that he is happy that many brands were beginning to slash their prices.
He was of the view that the brands manufacturers were ripping Nigerians off, adding that the government was not doing enough to compel the local manufactures to reduce the prices of their brands.
James said, despite the fact that Naira has appreciated significantly against Dollar, in the past four to five months the level of price reduction was nothing to write home about, simply because many local manufacturers like to exploit their customers.
“ Why are many local manufacturers finding it difficult to slash the prices of their goods. When the Naira was experiencing free fall against major currencies, local manufacturers attributed their daily hike in prices of their wares to the fact that Naira was crashing at the foreign exchange market against the major currencies.
“In the past four to six months Naira has stabilized at about N350 to N360 to one United States Dollar, as against N500 to N530 it exchanged at the close of 2016 and early 2017”, he said.
He berated the Federal Government for failing to call the leadership of the Manufacturers Association of Nigeria (MAN), to order their members to reduce their prices, adding that when the Naira was on a free fall, MAN were always shouting, appealing to the Central Bank of Nigeria and the Federal Government to halt the tide, but have kept mute now that the majority of their members have failed to reduce their prices when Naira has stabilized at about N350 to one Dollar, in the past four to six months.