Rice is a staple cereal in Tanzania. It costs about 50/= @kg to transport rice from Mwanza, where it is produced, to Dar es Salaam (Dar), the largest by population, population density and affluence.
Yet the retail price of this ungraded rice in Dar ranges from 500/= and 700/= (or 400/= and 560/= before 20% VAT) higher in Dar depending on the period of the year. A merchant from Mwanza will store the rice at a price of 50/= @kg for as long as it takes to sell to a merchant in Dar.
Retail prices in Dar therefore incorporate other costs that could be minimized in a better environment.
My own analysis indicates that it is possible to bring this price down and earn the same profit per kg while serving a larger number of consumers at predictable prices throughout the year and at comparable prices across regions in the country. It extends to other products grown in the country.
Someone has got to start selling different brands of juice from Azam. Importantly, that someone should be able to sell it at a lower price and good quality. ‘Good’ quality because Azam’s juice, which costs as high as 2 or 3 times the juice made at a local restaurant at no spectacularly better quality, is bad and their orange juice leaves easily noticeable strong orange peel smell! Yet, the brand’s juice fills every fridge in the country!
How can’t an entrepreneur in Tanzania package good quality and better priced juice from fruits harvested in the country throughout the year?
Cover image courtesy of kusini.wordpress.com
