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Street vendors turn to cash dealing

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STREET vendors are turning to cash dealing as the search of the elusive United States dollar continues to intensify, amid growing shortages.

BY TATIRA ZWINOIRA

Stern Zvorwadza
Stern Zvorwadza

Vendors are now aiming at selling a higher quantity of goods at a cheaper price especially chocolate bars and small packets of chips.

For example, Pascal chocolate bars are being sold for $1 for four against the market price of $0,50 each. A small packet of chips is being sold at $1 for three against a market price of $0,50 per packet.

After the vendor receives the cash in United States dollars they sell it in exchange for bond notes and use it to buy a higher quantity of their goods. If the cash comes in bond notes, they buy dollars and sell it at a higher mark-up to cover the loss made on their product while also including their profit margin.

Selling cash comes with a 20% to 30% mark-up.

Economist, Kipson Gundani, told NewsDay on Monday it was a numbers game wherein the practice involved vendors selling their wares at below cost price and using the cash to buy and sell dollars from cash dealers.

“Now looking at this issue there is another dimension that has been added now. There is a bond note vis-à-vis the United States dollar which everybody is looking for. This is why you find those people selling their goods at a price far less than they do at the flea market,” he said.

“If you recall even before the introduction of bond notes, you would discover there was a time that around 6 or 8 pm you would get into town and would see groceries on the pavement being sold at price less than the retail price.”

Gundani said the practice of buying and selling cash was more lucrative, as it provided a higher mark-up than when selling their wares.
Vendors in Zimbabwe earn an estimated daily revenue of $10,84 million.

Vendors told NewsDay yesterday that declining sales have resulted in them resorting to cash dealing.

“The cash is declining and we are finding it difficult to operate. We need cash,” a vendor who refused to be named said.

No comment could be obtained from National Vendors Union of Zimbabwe as the association’s chairperson Stern Zvorwadza did not respond to NewsDay inquiries.

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