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Gov't offers retailers four-month licence for discounts
by This email address is being protected from spam bots, you need Javascript enabled to view it on Sunday, 7 June 2009
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Results 1 to 11 of 11
Posted on Monday, 8 June 2009
@Geekay & @Thomas J, Tsk Tsk Tsk
Posted by Sand Jockey at 23:32 UAE time
It was once said "Better to be silent and thought a fool than to open your mouth and remove all doubt.", a lesson that both of you might want to heed.
1. I, amongst my other businesses, am a retailer so yes, I do know of what I speak.
2. Nobody, and I mean NOBODY, anticipated crazy rent increases such as we've seen. So then, can you care to tell me how this could have been planned for?
3. The cost of shipping goods has NOT gone down. In fact it has gone up both due to fuel surcharges (which are still in place), lack of available transport and, funny enough, not enough containers to ship goods in.
4. We don't know what profit margins any retailer is making. We only surmise but we dont' know their costs. In fact, we are all only assuming that they are making huge profits.
5. Finally, before you both go off an another rant, remember what was originally talking about...not whether or not company x or company y were making money, but rather the stupid request for government interference when MARKET forces should dictate prices.
Gentlemen, this isn't personal, although you are making it so, rather it is simple economics. Dont' like the prices, then don't patronize the store. Sooner or later, if enough folks do so, they will get the message.
SJ
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permit?
Posted by paul at 20:31 UAE time
"Retailers in Dubai usually have to apply, and pay a significant amount of money, for a special permit every time they want to hold a sale."
This is really unbelievable. On one hand the authorities are demanding supermarkets lower food prices, on the other hand they charge a significant amount of money if a retailer wants to cut prices?
So much for the business friendly free market economy.
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Do the math before starting...
Posted by Geekay at 17:17 UAE time
If you say rent is fixed for 5 years, fixed assets have to be amortised and staff salaries have to be paid(like they increase with cost of living.. never in proportion), then you did not do the math before opening your shop. Some of these fixed costs are clear even before you open your shop. If your business plan had already taken these into account and you had already priced your goods with sufficient margin to feed your greed for profit.. then you increase the price of your stuff only to take the effect of any additional costs which increase due to inflation. So it is very right to decrease them when the same costs go down.. like transport costs, rents (offcourse they have decreased in recent times and large business houses are in much better position to renegotiate with the mall owners)... And we are talking about the big fish who has been milking the consumer wave for years in the UAE and not about small shop set ups who have anyway disappeared or struggling not to disappear in the recent turn of events... Now you go, take a cab to nowhere and then figure.. nothing personal.. just brainstorm..
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Time to lower Margins
Posted by Thomas J at 16:20 UAE time
So Sand Jockey you say go Figure??
its not difficult to figure, the retailers have been ripping customers off for years its now time to come back to reality and REDUCE YOUR PROFIT MARGINS. or has your level of GREED made you BLIND TO REALITY.
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If it's free then why do you want Govt. interference
Posted by Sand Jockey at 14:21 UAE time
Ah yes, another purveyor of "free market as long as it benefits me". It's simple, either you let market forces dictate prices paid or you then suffer the see-saw effect of governments, behind the power curve, trying to "set prices". This, in case you aren't sure, doesn't work in a capitalistic society which, by your own claim of the "UAE mall culture", most definitely describes UAE.
Keep the governments out of the price fray, let the retailers make money in good times and bad. Be they Exxon Mobil or the little mom&pop shop around the corner every organization has to make money to survive. Just because you THINK the prices have gone down doesn't mean they have. Just because you THINK that their rents have gone down doesn't mean they have. Just because you THINK that their costs have gone down doesn't mean they have.
Do the math.
- You say that there are less people in the outlets. Less people = lower revenues.
- Rents are contracted out in advance, sometimes as far out as 5 years. Rent does not vary that much
- There is the cost of fitout which must be amortized over a period of years. That doesn't change
- Staff salaries stay the same.
- Food costs have NOT gone down
So, costs are the same, revenue is down, and yet you want them to lower their prices.
Go figure.
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Sales
Posted by iqbal at 13:48 UAE time
Items put on sale here are usually out of fashion, odd sizes or defective. I have been to these sales and could never find a size that fits my children, eighter its too small or too big or there is something missing. It's just a way of getting rid of the invetory. Which is fair enough. Just an overview, no objections.
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UAE market - freeer than free
Posted by Geekay at 13:01 UAE time
Here any retailer can charge whatever they want. Some shops have so called SALE all through the year. What kind of SALE goes on the whole year? So what about the quality if such stuff? Pls wake up to the fact that the retail food joints did increase the price of food items at par or even more when the rents and other costs were higher. Pls dont make it sound like they were giving away food at losses which they have to make good now. Yes offcourse they buy in bulk (not from super markets) and that should be good reason enough to get better prices from their suppliers and to reduce their prices. Govt should atleast have some control on what is offered and at what price because this would overall make the country less attractive to outsiders and malls less attractive to customers. Eating in or outside the home is a matter of choice and personal remarks only dilute the issue discussed. And Yes in this market, I would not mind if the Govt interfered in salaries of the middle and low income group.
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@ GeeKay - Why do you need / want government interference?
Posted by Sand Jockey at 11:51 UAE time
It never ceases to amaze how folks want government interference in so many parts of their lives.
Why should the government be involved in the prices that a retailer charges? Basic economics teach you that market forces will determine prices and government interference is a BAD THING.
If you want to eat at home then go for it. If you don't like the prices that food retailers are charging then don't eat there. Either way, don't ask the government to step in.
Now, all that being said, did you have any problem when the rents were high and the food prices were at today's level? After all, the costs were the higher (retail food outlets buy in bulk, not from supermarkets) or at worst the same so why can't the retail outlets make a little money now?
Geesh, next you will want the government to interfere in how much salary you make.
SJ
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Permission for discounts??
Posted by Skeptic at 09:05 UAE time
"Retailers in Dubai usually have to apply, and pay a significant amount of money, for a special permit every time they want to hold a sale."
This is a joke. Seems like the Dubai Government's only job is to make the life of consumers miserable. There should be no approval or fees required if a retailer wants to reduce prices or hold a sale.
The restaurant comments made by some readers are correct. All restaurants increased prices during 2008 and even at the start of 2009. However, now that the food prices have gone down considerably, none of the restaurants have decreased their prices. And they are losing business... I see much less people in restaurants now even in the most popular ones. Something needs to be done to bring down the restaurant prices.
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Posted on Sunday, 7 June 2009
Retailers greed
Posted by Geekay at 17:40 UAE time
Most retailers have announced SALE but still at very high prices. Who is checking all this? Most food joints(especially fast food like KFC, Pizza Hut, McDonalds, and the likes) have not bothered to bring prices to pre-hike levels. Rents have come down, transport costs have come down, cost of food stuff has been reduced at supermarkets(thanks to some Govt effort) but the greedy food retailers have not reduded the prices. Govt should interfere before more and more people will star cooking indoors and shopping malls will become more empty as people do not want to spend anymore on these so called sales. Food courts and shopping are directly related in the UAE mall culture. So Govt should do something soon to force restaurents to reduce the prices.
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Gov't offers retailers four-month licence for discounts
Posted by Tome de Souza at 15:21 UAE time
May be it is just the opposite!!! The DSF committee foresees that retailers would not be having any sale or promotions this year due to the recession crisis hence they might be losing the revenue on license permits.
Probably the four-month license for discounts would keep the revenue graph look slightly better.
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