ZIMBABWE’s largest fast food chain, Simbisa Brands Limited (SBL), says it will implement a two-tier pricing model, offering discounts for customers paying in United States dollars as it tries to raise foreign currency required to pay royalties for the foreign franchises it operates.
The model, which has been adopted by mostly smaller informal retailers, will see discounts for customers using the United States dollar, while those using real time gross settlement balances (swipe), mobile money or bond notes will be charged a different price.
A 500ml bottle of water will cost $1,50 in local money or US$0,50. At Bakers Inn, one of the brands operated by SBL, a quarter chicken has been priced at US$2 or $7 in local currency.
The trend is a practical reflection of how the bond note and RTGS have lost value contrary to government insistence that they are at par with the greenback.
“We need something like $1,2 million in hard currency every month, but on average we are only managing about $100 000, so we need the foreign currency to meet our obligations. This is why we have introduced discounted prices for those paying in hard currency, which is even cheaper than what it is in South Africa to our clients. We are simply asking our clients to be able to support to get the forex we need,” chief executive Warren Meares told NewsDay yesterday.
“The Reserve Bank of Zimbabwe has not been giving us any forex, so now we have to raise our own forex to meet our costs. Right now the priority is fuel and flour.”
He said prices in United States dollars were at below cost when compared with prices in South Africa, but admitted they had increased prices at least four times this year.
SBL has a total of 211 restaurant outlets across the country, employing 4 000 people serving 4,5 million customers a month.
It operates Chicken Inn, Pizza Inn, Baker’s Inn, Creamy Inn, Fish Inn, Rocomamas, Steers, Nando’s, and Galito’s.
“The import duties and taxes on imported raw materials also now have to be settled in foreign currency. Due to the prevailing national circumstances, all our bankers are failing to provide us with foreign currency at the regulated exchange rate of 1:1 between US dollar, and local dollars”.
In the 2019 National Budget presented last month, Treasury introduced a list of goods that will require duties to be settled in forex, which include cheese and cold meats; key inputs for Simbisa.