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May 24 2012 17:31
The Reserve Bank will maintain current interest rates, and a sizeable reduction in the local petrol price is expected, says governor Gill Marcus.
May 24 2012 15:29
The Reserve Bank will maintain current interest rates, says governor Gill Marcus.
May 24 2012 12:00
Britain fell deeper into recession than initially thought in the first quarter of 2012, upping chances that the central bank could inject more stimulus into the economy.
Pretoria - South African retailers do not make excessive profits and will exert even more pressure on suppliers to keep prices low, said an analyst.
"Supermarkets built their network of shops and brands over many years," said Nedgroup Securities retail analyst Syd Vianello. "One needs a lot of money to operate a supermarket."
He said food inflation may sometimes benefit supermarkets, because they are able to sell products bought at lower prices at a higher margin.
"That's part of the gamble," said Vianello. "It works the other way around when inflation goes down."
He said food inflation is easing at present, putting pressure on retailers' margins. This will force them to exert more pressure on suppliers.
"Supermarkets sell shelf space. They'll dump a product when it doesn't yield a solid return."
Grant Pattison, chairperson of the Consumer Goods Council of South Africa, said it has never received any complaint from suppliers being bullied by supermarkets.
However, the National Agricultural Marketing Council (NAMC) said in May it will ask the minister of agriculture to request an investigation by the Competition Commission into the dominating relationship retailers maintain with their suppliers.
In response, retailing giants Pick n Pay and Shoprite said they will welcome any investigation into uncompetitive behaviour in South Africa's food chain.
- Sake24.com
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