During weekdays, it is better to visit the holiday bazaar at the Exhibition Centre than during office hours, before the bulk of employees teem. On Monday April 6, 2015, when Fortune visited the event, “Addis Trade for Development Grand Trade Fair”, organized by Century Promotion, there seemed to be fewer visitors/shoppers than there were traders participating in the bazaar.
One of the visitors, Beakal Tesfaye, did not buy the electric baker for injera, as he had intended, because of the higher price than he expected; he just bought mattress and pillows and left.
Among the sellers of the products that Beakal bought in the Centre was Ma Garment, which carried its products from Mekele for the bazaar, where it has a 12sqm booth. Its feather pillows are selling for 120 Br. Ma’s trousers are selling for 300 Br to 350 Br, and its sweaters for 250 Br.
“This exhibition is very cold; only those who want to enjoy drinks are coming to the exhibition and the exhibition space rentals have also increased from the previous years’,” laments Tsegaye Berhanu, the salesperson.
This year’s exhibition, organized by the 15-year events organization veteran and bazaar organizing firm-Century Promotion Service- attracted 350 exhibitors with the total number of visitors expected to reach 300,000 at the end of the exhibition on April 11, 2015. This year has seen a higher number of foreign exhibitors, with a total of 40 taking part.
The organizers, which had been in preparation for the past six months for the bazaar, opened their gates for visitors on March 26, 2015 at an entrance fee of 10 Br. Among the participants are 96 manufacturers, included some that export their products, according to Zewege Jemaneh, managing director of Century.
“The challenge of this year’s preparation is to bring more visitors to the place in the first week,” Zewege told Fortune.
To do that Century had to spend 650,000 Br for advertising only, which was twice its budget for a similar event it had for the Ethiopian New Year, Zewge says.
“Although the number of visitors was very small for the first week, the number reached 19,000 on Sunday, which indicated that there will be more visitors when the holiday approaches,” Zewge said optimistically.
Century is encouraging more visitors to come with raffle prizes of refrigerators, stoves, washing machines and irons everyday with the entrance tickets.
The other challenge that Zewege raised is the decrease in the number of exhibitors from the 400 that they had for the New Year to 350. Some have not returned after failing to make sales during the New Year bazaar, Zewge says. Besides, any one who could pay the rent for the space was welcome in earlier events; now they need to have trade licenses to participate, he added, a criterion which has been introduced “for the sake of security and credibility.”
The participants in the exhibition have two optional places to acquire in 23,000sqm compound: the pavilions or the tents outside. The places in the three pavilions are worth 29,000 Br per nine square meters while the same area outside the pavilions costs 4,000 Br. Businesses from outside Ethiopia are paying 33,500 Br for the same nine square metre inside the pavilion.
The first pavilion can accommodate 80 exhibitors while the other two accommodate 45 exhibitors each, according to Zewge.
But the exhibitors claim that the rent expense was too much and increasing over time.
One of these is Saba Eshetu from Rhobot Spice Producers, who was displaying 17 kinds of spices in a nine square metre booth inside the pavilion.
“The rent that we paid for the same space four years back was only 12,000 Br, but now it has increased to 29,000 Br making it more unaffordable as time goes on,” she says.
The bottles of spices are now properly labelled with the name and address of the business so that customers met at this bazaar could follow. Prices are also higher, according to Saba.
“For example, the cost of white spice four years back was 16 Br, while now we sell it for 26 Br,” Saba affirms.
Not all are sounding gloomy. Kidus Melaku, Jimma Handicraft Manufacturer, an enterprise with five members, came from Jimma, in Oromia, with expectations of higher sells and they are getting it.
“We come from Jimma in order to sales at better prices. We do not sell more than 5,000 Br a day there, but here we make15,000 Br to 20,000 Br a day,” said Abebe Demisie, the work process head, who was assembling the products they had brought to the bazaar.
They also have one benefit here, which they did not have in Jimma – the secret to the better price they get here.
“As it is an exhibition we are not required to issue receipts; this is one reason why we choose to participate in the bazaar,” says Abebe.
But Zewge claims that they advise the exhibitors to bring cash registers and use them whenever they sell products.
“We also write letters of participation in order to enable our exhibitors be able to move their cash register machines here,” he says.
This works well as the visitors at the exhibitions do not request receipts when they purchase products.
“I do not request it; it does not even occur to me to do so,” said Beakal, dismayed that he had not thought of it.
Another visitor, Simea Ayenew, also does not think of receipt issuance even though the price stands the same whether or not receipts are issued.
“It is like a tax-free area,” stressed Simea.
But the Ethiopian Revenues & Customs Authority (ERCA) begs to differ and in point of fact states that this kind of sale is totally against the law and there should be some kind of control. But they do not have a system in place because of the difficulty to control the participants identifying their subsidies.
“We allow the use of temporary receipts when the organizers send us letters that the traders are to participate in the exhibitions; but selling without issuing receipts is against the law,” says Woinshet Furgassa, Cash Register Machine acting team leader.
The regulatory work is the mandate of the districts, she says, adding that they should be able to identify participants from their respective districts and do follow-up on them.
The Tax Information Administration Work Process coordinator at Kirkos District, Agegnehu Aseffa, says that it is difficult to identify and follow the participants to use cash registers as they come from different districts and other parts of the country.
“We have raised these issues on a meeting with the head office and it is a big failure from the Authority’s side as we should have collected a great deal of tax from that place,” Agegnehu says. “As it is complex, it needs to be addressed at the head office level.”
The punishment for sale without issuing receipts comes in three stages. In the first instance, it is 15,000 Br, which goes up to 50,000 Br in the second instance. The third instance will take the business to court, says Agegnehu.
Kirkos Disitrct will push more for the implementation of some kind of measure as the place is found in its jurisdiction, says Agegnehu.
While this may curb the volume of revenues made by the participants, Zewge says his company is in talks with participants to have similar products at the same place to make it easier for visitors to browse and shop and improve sales.
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