Domestic Commerce:
Supply,Distributio & Retailing in Sudan

SUDAN GUIDELINES ON SECTORAL ALLOCATION OF FINANCING,WHICH INCLUDES A FAIR SHARE TO MANUFACTURING,WE might anticipate a growing substitution of imports in the open market by locally produced items. In Khartoum, the market has traditionally been somewhat geographically segmented, with certain types of products often identified withspecific areas of the city. Business items, such as computers, stationeries, office furniture, and office related services, are mainly concentrated in the central business district.

Home furniture stores continue to proliferate in the residential areas in consonance with real estate development. Livestock related goods are found in the vicinity of the trading markets. However, as the economy grows and new neighborhoods develop, the retail sector becomes increasing decentralized geographically. The most conspicuous symbol of this trend is the Afra Shopping Center opened in early 2004, the largest single retail complex ever seen in Sudan. Located in the exclusive Amarat/Riyadh section of Khartoum, Afra Shopping Center aims to enhance the commercial culture development of Sudan’s elite. Here, under one roof, you can find an item range from Pierre Cardin gentlemen’s wear to traditional Sudanese leopard skin shoes, to icing coated pastries, assorted vegetables, to children’s wear and bridal gowns.

Modes of purchase also vary. While cash and carry predominates and cheques are rarely used in retail purchasing, hire purchase stores offer convenient credit terms, given guarantees from an employer or bank. They even market to factories and other employers, enabling workers to purchase televisions, freezers, and other household
goods that they are unable to pay cash for. Also, there are credit schemes for household goods marketed from door to door in the neighborhoods. Khartoum sustains a viable, if sometimes default jolted, credit system that extends to people’s ordinary purchases from neighborhood grocery stores.

Sudan Duty Free Stores offer shoppers the opportunity to pay non-tariff prices with euros or dollars. Owned by Sudan Free Zones & Markets Company, Sudan Duty Free Stores offer a range of household items, including washing machines, televisions, refrigerators, cooking ranges, dish washers, IT equipment, and photo copy machines at attractive prices– if only one can get his hands on the foreign currency. SFZ operates a number of outlets in urban areas, as well as a large showroom at Khartoum International Fair grounds and a computer mall in the exclusive
neighbourhood of Amarat.

Sudan’s per capita purchasing power parity (PPP) income is currently about $2,000, a figure
which hides a significantly uneven distribution of income. A substantial portion of the average Sudanese family income is spent on food. The staple is a nut shaped bean (foule, which literally translates to nut) that is common to the Nile Valley. Typically spiced with onion, cheese, and fried bean cake, sometimes shredded carrot also, foule is commonly eaten for breakfast and often dinner as well. Packaged vegetables are a non-starter; fresh fruits and vegetables are abundant.

Perhaps, the most frequently consumed industrial food product is the carbonated soft drink, followed by packaged fruit juice. However, elite consumption provides vitality to the retail trade in non-perishable goods.

A 30cl bottle of Coca Cola costs SD50, about US20¢; the recently introduced mobile package, that is a 60cl plastic disposable bottle of carbonated soft drink, costs about 40¢ and has become very popular. The 500 gram size of
Capo yoghurt without sugar costs about 80¢ and the half litre paper pack of fresh long-life Taza milk costs about 50¢. All of these items are fast movers in the business districts, but the large sized yoghurt and homogenized milks are often not found in lower-class and lower middle class residential neighborhoods. There is no official price control, but retain prices are stipulated by the manufacturers or importers. Markups on grocery items average about 20%.
Neighborhood grocers are expected to prepare foule in the mornings and evenings and prepare
it for customers with cheese, bean cake, and oil. They are also expected to have sufficient supply of fresh farm milk mornings and evenings. These are, of course, high turnover items and an important part of the business.

In the garment business, well tailored suits made by elite haberdashers face competition from larger scale custom producers, but imports often have the disadvantage of neither giving the exact fit nor the desired styling details.
Imported perfumes usually end up mixed into traditional Sudanese blends, repackaged and sold in specialty stores.
Pharmaceuticals constitute another area in which Sudanese producers play a significant role, but mainly at the low end. Nevertheless, urban pharmacies can be well stocked, especially in the vicinity of Khartoum Hospital. It would appear that a substantial percentage of Sudanese wear eyeglasses and this is reflected in the number of attractive optical showrooms in the capital city. One can purchase a pair of portable eyeglasses that fold into a case proportioned as if it were a fountain pen by simply examining oneself on a chart hanging on the pharmacy wall.

Trading is big business in Sudan and there are a number of major import firms. However,with port facilities for this 2.5 million sq. km country of 35 million inhabitants only on the Red Sea coast, some 800 km away from the capital and nearly 1,500 km from El Obeid, the third major city, importation involves tremendous handling and transport efforts. With transport costs from Port Sudan to the remote areas of the country highest, we invariably have situations in which imported goods are most expensive where incomes are least.

As Sudan’s second largest urban market, though its population is only about one fifth that of Khartoum’s, Port Sudan is an important commercial hub in its own right. However, high value to weight ratio goods, such as IT equipment, cell phones, and jewelry, are typically imported by air. Wholesale distribution may be done through the importers’ own facilities or through independent agents. In the lower and lower middle- income neighborhoods, carts drawn by
donkeys can be seen supplying the small grocery stores. On the main roads, pickup trucks and large brand identity vans can be seen supplying foodstuffs, building materials, and even pre-cut hamburgers for cafeterias. Consumer
prices for the most commonly bought items have tended to be stable over the past three years. However, the escalating price of real estate and commercial outlet rents occasions a high retail business closure rate and may in
the near future prompt upward movement of prices for items that are not sold in the traditional marketplaces.

The traditional African market is still a favorite shopping place for most Sudanese. Some of these markets span over several square kilometers and have hundreds of venders, usually selling wearing apparel, food and toiletry items,
household wares, watches, sunglasses, personal effects bags, perfumes, and other simple goods. Those selling from rented shops in the markets often consign goods to marginal venders, who sell on the sidewalks. This enables a retailer to put a greater quantity of goods on sale than his store can hold and increase the rate of his stock turnover.
If you want to buy the latest information technology digital wonders, shop in central Khartoum. Some stores are better equipped than others and not all have strong maintenance services, but if you connect with the
right place, reasonable satisfaction can be forthcoming. The IT market is highly competitive and always up-to-date with the latest imports from Dubai. Clones still dominate the PC market, but aside from top brand name laptops, PCs from Dell and HP are enjoying increasing demand.

There are courses available awarding Microsoft diplomas and a growing number of Sudanese with foreign experience in the IT engineering profession. The latest video cameras, digital cameras, and stereo equipment are available in Khartoum and Port Sudan. As for automobiles,the market, traditionally dominated by Toyota, grows increasingly competitive year by year, with Honda recently introduced and the new locally assembled Hyundai Sonata gaining popularity in the low end luxury market.

BMW and Mitsubishi are sold from Khartoum showrooms belonging to major Sudanese conglomerates, but independent vehicle traders based in Saudi Arabia assure that almost every type of vehicle Sudanese would be inclined to buy reaches the market. Duly registered trading companies have access to the administrative and foreign exchange requirements for importation. Imported items arriving in Sudan should be properly identified by documentation and are subject to customs scrutiny, evaluation, and duties. Although the trading sector is basically reserved for Sudanese, at the upper end of the scale, there are opportunities for companies like Turkey’s Afra that come in big. Afra plans to establish shopping malls in other sizable cities around Sudan.

The Afra investment marks a great step forward for Sudan’s retail sector, which hitherto had no world-class shopping mall or even supermarket. With this single investment from Turkey, the face of retailing in Sudan has been
refashioned. Prices for most items are no higher than elsewhere and Afra Shopping Center includes a game room for juveniles, indoor and outdoor snack facilities, a Kodak photography shop with instant digital photo printing facility, and Sudan’s first bowling lanes.

From a consumer perspective, shopping in Sudan leaves little to be desired. From a business perspective, domestic trade is essentially collaboration between Sudanese importers and sellers, on the one hand, and externally based
exporters, on the other. Goods are found in Sudan from virtually every part of the world.

The country’s major import supplier is Saudi Arabia with 25% of the total value, followed by the European Union with 14%, China with 8%, and the United Arab Emirates with 6%. The indication is that the import profile is mainly Arab and Asian oriented, with countries geographically east of Sudan supplying 62% of Sudan’s 2003 imports, which amounted to $2.882 billion. The figures do not altogether correlate with the visible impression one gets in the retail market, because a substantial portion of the goods imported into Sudan from Saudi Arabia and other Gulf States
are manufactured elsewhere. For example, ladies’ tobes imported from Gulf States, where there is no domestic market for them aside from Sudanese living there, are mostly manufactured in Switzerland.

The frequency of trade fairs and exhibitions in Sudan and the large audiences they draw indicate the extent to which commerce and industry have become features of contemporary Sudanese culture. Sudanese have not traditionally
been known for extravagance but there is a lot of room for living standard improvement, especially in health, home toilet and kitchen facilities. Importers, as well as local manufacturers, are aware of the marketing possibilities in this regard and cater to them. Sudanese are today exposed to all the common convenience items used in the industrialized countries and disposed to buying whatever useful artifacts they can afford.

Moreover, many of the elites are aware that increased purchasing power and higher per capita productivity value are complements.