High prices in City curb retail demand
High prices in City curb retail demand
Demand for goods in HCM City has remained depressed for long, affecting all manner of retailers, but they are unable to reduce prices as cost of fuel and other inputs are high.
At Tan Binh Market, 550 out of 12,000 shopkeepers have stopped doing business, while in Thi Nghe, sales are down an estimated 30 - 40 per cent from the same period last year.
Rentals on many famous shopping streets have plunged 25-40 per cent as shopkeepers are unable to pay high rents.
Supermarkets and shopping malls too are facing tough times, with some of them being forced to close down.
There are several reasons for the bleak situation: high prices, belt-tightening by consumers, and the popularity of fake and smuggled goods.
The reasons for the high prices are the usual suspects: high petrol, electricity, transport and raw materials prices and steep taxes and fees.
Nhan Dan (The People) newspaper quoted Tran Minh Phat, director of Vuong Dat Company Limited, as saying: "Large amounts of credit at low interest rates, a cut in taxes and fees, and affordable fuel and electricity prices are the only things that can help enterprises survive and reduce prices of goods."
Le Ngoc Dao, deputy director of the city's Department of Industry and Trade, said: "Consumption stimulus is the most important measure in the current situation. Manufacturing enterprises should co-operate with dealers to set proper prices that would encourage customers to buy."
The department has started a training course to improve the management skills of the managers of traditional markets.
Another course on selling skills for shopkeepers will be held in all 24 districts.
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