A very unmerry Christmas!

There's going to be little stock after supermarkets were plundered following a government blitz end June that forced prices down by at least 50%.

“Trading conditions for TM Supermarkets were very difficult,” Moxon admits, insisting operations had been severely affected by price controls and stock outages caused by the consumer rush for cheap commodities.

Now, it is turning out to be very difficult to replenish, even with huge sums of cheap money lent to TM Supermarkets, which Meikles jointly owns with South Africa's Pick n Pay, under the central bank's BACOSSI fund.

“Funding of stock replacement is a major factor in putting merchandise back on the shelves,” Moxon says.

“BACOSSI funds have been allocated to the TM Supermarkets and these will assist in this process, so long as stock can be sourced”.

However, here's the conundrum: since the June blitz, and borrowing directly from Moxon, “suppliers were unable to replace stock on a timely basis”.

TM Supermarket's selection of locally manufactured products diminished because of poor supply and delivery constraints.

It's a common song all retailers are singing

Thembinkosi Sibanda, chairman of clothing retailer Edgars Stores Limited, majority-owned by South Africa's Edgars group through Bellfield Limited, is equally disillusioned.

Clothing and footwear retailing depends on a long merchandise pipeline, starting with the placement of fabric orders and ending with the delivery of the finished garment to a store. At best of times, says Sibanda, this takes about six months.

“During the period from July to September this year, there was no agreement with the authorities as to what pricing modules would apply to clothing manufacturers and retailers. As a result, the merchandise supply pipeline collapsed for about three months,” Sibanda says in his statement accompanying Edgars' financial results for 39 weeks to October 2007.

Hence, for Edgars, restocking will continue into the New Year, so don't expect new pieces of clothing in the wardrobe too soon into the New Year.

“The major constraints in this regard will remain the capacity of our suppliers and the working capital erosion due to inflation and reduced margins,” Sibanda warns.

Admittedly, there is now hope for a turn in the short term, but even if stock levels were quickly replenished, there's a new dog nagging the market: Cash!

There's no money in the banks

Just today, December 14, 2007, people packed the banking halls, just waiting. The idea is once someone comes in to make a deposit, the teller calls the person at the front of the queue to make a withdrawal. Moreover, the limit, reduced from Z$20 million to just Z$5 million due to the severity of the cash crunch, isn't enough to cover for bus fare for two trips from home to work.

“The problem with consumers is that the medium of exchange has been removed from the transaction equation. Consumers are now spending more time looking for the medium of exchange (but) Z$5 million is only what they are getting from the custodians of their funds,” wrote one commentator in a local news site.

Both retailers and consumers are turning out into losers from the crisis.

Reserve Bank of Zimbabwe governor, Gideon Gono, has promised to remedy the situation before Christmas.

The cash crisis, he said, was “the manifestation of a web that would soon be untangled”.

Both Edgars and Meikles, which runs the country's top departmental store brands, have withdrawn credit facilities for their customers to get cash.

Edgars says it will resume credit sales “once stores are fully stocked and management is convinced that inflation is trending down”.

Meikles says credit sales were withdrawn so that working capital could be “more effectively managed”.