Could 2022 end up being another daunting year? This seems to be an underlying question given an increase in prices of most goods and services. The challenges facing markets this year come on the heels of the previous two-years impact from the pandemic as a result of Covid19 disease, hiccups in global supply chains and shortages in various products.
The resulting market scenario has therefore left many businesses grappling with another round of uncertainty. In addition, the geo-political situations, both regionally and globally are adding fuel to already high blaze. Zimbabwe just announced a 191% in June 2022, according to recent media reports. Sudan still commands an inflation rate at over 200%. The increase in oil prices has only exacerbated the situation. Prices for basic consumer goods have risen quite sharply, with month-on-month changes ranging from a few percentage points in some markets to double or event triple digit increase depending on the market.
However, like the proverbial two-sided coin, the current situation has stories of both sides of the divide. For instance, the increase in oil prices is a pain to the oil importing countries, but a boon to the oil exporting ones.
Hence, it is important to look at the underlying factors within each economy, within each sector, sub-sector and even within a given category. In addition, understanding the cause of inflation is important especially in managing the prices increases and price variations. Prices may change but value should hold. It is important to clearly understand what customers want, what are the emerging trade-offs and how is the market scenario impacting the share of wallet on your products.
At Episodes Research, we work with partners and clients across the Africa to help navigate such nuances. We invite you to share your comments. We are glad to partner with you in this conversation.