YT on the Road: Gauging Changes in Consumer Demand [Archives:1998/32/Business & Economy]

August 10 1998

The economic reform measures have been biting into the family budget – prices are increasing, incomes are falling, subsidized goods are no more, and formerly free services (education, health, etc.) are no more. We are talking of a falling purchasing power. So, how is the family budget coping?
The basic answer, is that people are less frequently shopping. To measure how much consumer taste and patterns have been affected, the Yemen Times sent out feelers. Ismail Al-Ghabry led the effort.
Basically, the task was to talk to shop owners. The Yemen Times visited retailers of clothings/garments, household consumer goods, foodstuffs, contruction material, spices, etc.
The overall picture is that there has been a dramatic fall in business. Economists call the slack in business a recession or stagnation.
The survey was carried out during July 1998, and only in Sanaa. The following questions were put to people in the survey sample:
Q1: How do you assess business nowadays?
Q2: Can you compare it with last year’s?
Q3: What are the products most in demand nowadays?
Q4: How much has consumer taste changed?
Taha Dubaey,
spice trader:
“Business is not good at all these days. The number of customers is going down continuously. This is actually due to the economic hardships faced by the people. Ordinary people seldom buy spices these days. It is only well-off people who are not affected by price hikes.
“Comparing this year with last year, I find a big difference. The market situation is actually going from bad to worse. What I earn can hardly cover the rent of the shop.
“At my shop people can get ginger, hulba, black pepper, coffee, etc, which are not really necessary and indispensable. Ordinary people do not even dream of luxuries.
“Getting people satisfied with our goods and our services is a very important commercial technique. When your customers feel that you give them good services, they, of course, will visit you regularly.”
Mulhy Ahmad,
a café owner:
“See there are no customers at all. I have spent a lot of money on furnishing and equipping this café. I have even alotted a special section for families. My customers are getting fewer and fewer.
“We serve beverages, tea, sandwiches, hookah, juices, cold drinks, etc. We cannot compare this year with the last year. This year is very bad.
“We have to receive our customers with smiles. We have to deal with them in a cordial and friendly way so that they would come back. Of course the number of daily customers is not stable.”
Yahia Hameed Ali,
a green grocer:
“You can say that business is now in a recession. This is entirely different to the past years. This is of course because of the continuous price hikes. The authorities have to stabilize prices of everything. This will be good, even for us. Another possible reason behind this economic inactivity is that our market has become open to every Tom, Dick and Harry. Everybody is now a green grocer.
“Business is on the horns of a dilemma. In the past years it was very prosperous and fruitful. The reason for the current recession is the economic crisis, low level of investments, price hikes, and low personal income.
“The goods we now sell are mainly foodstuffs like vegetables, rice, flour, etc. But other things are not in great demand. There is another problem. People prefer foreign products because of the low quality of the local ones. In addition, people with fixed income can’t afford the various daily household demands.
“You have to smile and receive your customers with open arms. You have to make them always happy with you. The number of my customers changes constantly. Sometimes it is high and sometimes it is low. It depends on the prices.”
Ghasan Najeeb Al-Shaibani,
clothes retailer:
“In the past two years there was much activity in the market. Now it is in a state of stagnation. I am now trying to get rid of all the old fashioned stuff I have in stock, even if I do not make any profits, because I have to keep abreast with the new fashions.
“I can’t make any comparison between this year and the past years. Yemen is now in the pits. The problem is also with the low-income people. This is the summer season, and we should see brisk demand, but as you can see there are no customers.
“As clothes traders, we always try to import products of high international standards so that we can attract well-off people. Because they always try to get high-quality clothes. Middle-income people look for less expensive clothes. Low-income people have stopped buying clothes, I think. These are bad times.
“To be successful, a businessman has to satisfy the needs and demands of his customers. He has to be cheerful and must smile all the time, and should never frown or look angry. Without these attributes, he can never succeed. Of course, the number of the customers changes from time to time and the reason is purely economic.”
Saleh Al-Faqih,
a supermarket owner:
“For me I don’t see any economic stagnation. Most of my customers are non-Yemeni so everything is very normal.
“I think that every year has its own characteristic features. So comparisons can be right or wrong. Frankly speaking, the trading movement is excellent for me in every sense of the word.
“The products available in my supermarket are foodstuffs and canned goods made by international companies. They really have the lion’s share among other goods.
“Most of our customers are from the international community living in Sanaa. We should deal with them honestly and in a friendly way. This is one of the basic elements in our trade.”
Nasser Al-Kumaim,
a wholesaler:
“The people’s economic circumstances underwent a radical change recently. Trading has changed enormously. For example, I used to sell 20 cartons of soap, 10 cartons of cooking oil per month. But these days sometimes the income doesn’t even cover the electricity bill or the shop rent.
“The past few years were much better than this year. This is a bad year, and economic life is very stagnant now. In fact, we can hardly earn enough to cover the expenses of the day.
“Products on relatively higher demand are sugar, rice, cooking oil, etc. Many people I know have given up buying luxury goods on account of hard economic circumstances.
“Being honest, sociable and helpful is very useful for us and for our customers.”
Saleh Al-Miswari,
a supermarket manager:
“The retail business is not quite stable these days. The gross daily income at our supermarket fluctuates considerably. Generally speaking, business is gradually coming to a halt.
“There is a large difference from last year’s business performance. Recession started to slowly set in towards the end of 1997, and has gained bigger momentum this year.
“Consumers in general go now for the absolutely necessary commodities. They look for cheap goods even if they are not of very good quality. The average income now hardly covers the bare necessities. Luxury goods are now all but abandoned. A very small rich minority can still afford to buy various luxury items.
“Customers often complain of high prices, thinking that retailers deliberately raise prices to make bigger profit margins. It is really not up to the retailer, but price rises come from the wholesalers or the original producers. Our daily contact with shoppers puts us at the receiving end of their anger.”