BUA Cement Chairman, Abdulsamad Rabiu, has revealed how his company’s initiative to reduce cement prices to ₦3,500 per bag was undermined by unscrupulous dealers. During the 8th Annual General Meeting held on Thursday, August 29, Rabiu shared insights into how the dealers manipulated the company’s price reduction policy for their gain.
Rabiu explained that, despite BUA Cement’s decision to lower prices, many dealers failed to pass these savings on to customers. Instead, they took advantage of the situation, inflating prices to as much as ₦7,000 or ₦8,000 per bag while purchasing the cement from BUA at ₦3,500.
“A lot of the dealers took advantage of that policy. Rather than pass the low prices to the customers, they were selling at even double the price we sold to them,” Rabiu stated.
He further noted that the manipulation was so pervasive that BUA had already sold over a million tons of cement at the reduced price before fully realizing the extent of the issue.
Rabiu also highlighted external economic factors that contributed to the unsustainability of the pricing policy, including the devaluation of the naira and the removal of the fuel subsidy. These factors made it challenging for BUA to maintain the reduced price without effectively subsidizing the dealers.
“We wanted that price to stay at that level, but dealers refused. So, we could not sustain that simply because we did not want to be in a situation where we are subsidising dealers,” Rabiu emphasized.
Source: https://www.pulse.ng/
